Texas wins contest to host Samsung’s new $17 billion chip plant By Reuters

© Reuters. The brand of Samsung Electronics is seen at its workplace constructing in Seoul, South Korea January 7, 2019. REUTERS/Kim Hong-Ji/Recordsdata

By Joyce Lee and Tina Bellon

SEOUL/AUSTIN, Texas (Reuters) – Samsung Electronics (OTC:) Co Ltd mentioned on Wednesday it had picked Taylor, Texas as the situation for a brand new $17 billion plant to make superior chips for features akin to cell, 5G, high-performance computing and synthetic intelligence.

The plant would create 2,000 high-tech jobs with building to start within the first half of subsequent yr, and manufacturing resulting from begin within the second half of 2024, the South Korean tech big mentioned. It might additionally create a minimum of 6,500 building jobs, Texas Governor Greg Abbott mentioned.

The world’s largest reminiscence chipmaker and second-largest contract chip producer had additionally thought-about websites in Arizona and New York for the plant, which might be a lot greater than its solely different U.S. chip plant in Austin, Texas.

The corporate mentioned it selected Texas based mostly on components akin to infrastructure stability, authorities help and proximity to its current plant.

Samsung (KS:) is becoming a member of rivals TSMC and Intel (NASDAQ:) within the race to broaden chip contract manufacturing in the US, the place the sector is seen as an space of strategic competitors with China.

U.S. President Joe Biden’s administration has promised billions of {dollars} in federal funding to spice up chip manufacturing and analysis to make sure it has an edge over China in superior applied sciences and to handle shortages for crucial industries like autos.

“Securing America’s provide chains is a prime precedence for President Biden and his Administration,” U.S. Nationwide Financial Council Director Brian Deese and Nationwide Safety Advisor Jake Sullivan mentioned in an announcement welcoming Samsung’s funding.

“We’ll proceed to make use of each instrument and pursue each avenue to put money into our sources of energy like manufacturing and expertise.”

Abbott, flanked at a press convention by Samsung Electronics Vice Chairman Kinam Kim and U.S. Senator John Cornyn of Texas, mentioned the corporate’s determination was a testomony to Texas’s financial surroundings constructed on low taxes, cheap laws and strong infrastructure.

Texas final winter suffered a multi-day, widespread energy outage, inflicting some 300-400 billion received ($254-$339 million) in damages to Samsung’s current chip plant in Austin, Texas.

“I am extraordinarily assured that the ability grid is secure, resilient and dependable,” Abbott mentioned on Tuesday when requested about electrical energy provide for the plant.

The brand new website in Texas’s Williamson County, which contains the town of Taylor, provided one of the best incentives bundle of the websites Samsung was contemplating, sources beforehand informed Reuters.


Senator Cornyn on Tuesday referred to as on the Biden administration to speculate more cash to draw chip producers to the US, calling it a “nationwide safety crucial.”

“If China continues to saber-rattle, nearly all of the world might be at their mercy with regards to the availability of crucial semiconductors,” Cornyn mentioned.

Samsung’s Kim thanked the Biden administration for “creating an surroundings that helps corporations like Samsung as we work to broaden modern semiconductor manufacturing within the U.S.”

“We additionally thank the administration and Congress for his or her bipartisan help to swiftly enact federal incentives for home chip manufacturing and innovation.”

Samsung has not specified what the brand new plant will make past superior logic chips which can be utilized to energy cell gadgets and autonomous automobiles.

Analysts mentioned it might seemingly make cutting-edge chips of 5-nanometres or much less, utilizing machines made by the Netherland’s ASML, for giant shoppers like Qualcomm (NASDAQ:). Such chips can deal with extra information per space than the 14- and 28-nanometre chips Samsung’s current U.S. plant in Austin primarily makes.

The Taylor website, about 25 miles (40 kms) from Austin, spans greater than 5 million sq. metres, Samsung mentioned.

Samsung Electronics Vice Chairman Jay Y. Lee met White Home officers in addition to leaders of corporations together with Alphabet (NASDAQ:)’s Google, Amazon (NASDAQ:) and Microsoft (NASDAQ:) throughout a visit to the US final week.

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