The United States is set to award Samsung over $6 billion to expand the company’s presence in the country.
The Korean technology firm already has a burgeoning presence in Austin, Texas with projected plans for a new plant in Taylor to the tune of $17 million. The funding will be announced before the end of March and these awards will be drawn from the funding agreed in the 2022 Chips and Science Act.
What is the Chips and Science Act?
The act signed into law in August of 2022 was designed to boost the chip-making and semiconductor industry of America. Over $280 billion was allocated to boost U.S. competitiveness, innovation and national security over the next 10 years.
A total of $52.7 billion of this funding will be set aside for semiconductor manufacturing, R&D, and workforce development, with another $24 billion worth of tax credits for chip production on U.S. soil.
Despite being the world’s leading economy and the center of the global tech industry, the U.S. only produces 10% of its entire global supply of semiconductors. So the U.S. government has made it a priority to invest in companies that can produce them while creating jobs and contributing to local and national economy.
Samsung published a report last month detailing the company’s economic impact in the State of Texas to be $26.8 billion. The Austin and Taylor campuses supported 38,144 jobs in the area along with $1.7 billion in workers’ salaries
Greg Abbott, Governor of the State of Texas would said: “Texas is the No. 1 state for semiconductor manufacturing in the nation, thanks to partners like Samsung who contribute so much to our economy and communities in Central Texas and beyond.”
The Korean tech giant’s ties with the region go back to 1996, where “Samsung Austin Semiconductor has been an integral part of the Central Texas community by being drivers of job generation, economic impact and engagement within the community,” according to Jon Taylor, corporate vice president, Samsung Austin Semiconductor.
Samsung’s major rivals are Intel and Taiwan Semiconductor Manufacturing Co (TSMC), the world’s largest contract chipmaker. Both are set to receive investment from the U.S. Government in a bid to make the bulk of their chips in America, but the announcements have not been made official yet.
Last week, U.S. Secretary of Commerce Gina Raimondo delivered a speech Center for Strategic and International Studies (CSIS).
Raimondo reiterated the importance semiconductors will play in the future of U.S. technology: “We all know our modern world is powered by semiconductors. From windshield wipers to cell phones to pacemakers to rocket ships, chips are fundamental to every aspect of our lives and our economy.”
The Biden Administration last month announced that the National Semiconductor Technology Center (NSTC) would be backed by $5 billion in investment to natively research and develop more of the integral technology in America. This entity won’t be able to directly rival the corporate chipmakers operating in America, but it shows that there will be a public-private partnership presence in the research and development of U.S chips.
It remains to be seen which chipmaker will come out on top in the battle for the mantle of the biggest domestic producer of chips in the United States, but Intel, Samsung and TSMC are all in the frame to be heavily backed by the Chips Act for their investment in key states and their infrastructure.
Image: Samsung news.
