US grants Samsung up to $6.4B in subsidies for its chip investments there

Posted on : 2024-04-16 16:45 KST Modified on : 2024-04-16 17:21 KST
Samsung Electronics plans to invest over US$40 billion in the US, with plans for mass production of 2 nm process tech by 2026

Samsung Electronics was confirmed to be eligible for a maximum of US$6.4 billion in semiconductor subsidies from the US government on Monday.

The scale is similar to the amount received by the Taiwan Semiconductor Manufacturing Company, the world’s top foundry firm. In exchange for the subsidy, Samsung Electronics plans to invest over US$40 billion in the US and have a state-of-the-art process up and running there by 2026.

On Monday, the US Department of Commerce announced that a non-binding memorandum of terms had been reached to provide Samsung Electronics with up to $6.4 billion in direct funding. Through the CHIPS and Science Act, the department previously made plans to provide support of up to US$8.5 billion to the US-based Intel and up to US$6.6 billion to TSMC as part of a strategy to increase the proportion of semiconductors produced within the US.

In exchange for its subsidy, Samsung Electronics plans to more than double the size of its investments in the US. The US Department of Commerce explained that the company was expected to invest over US$40 billion in the US over the next few years, creating over 20,000 jobs in the process. The amount is more than twice the investment of US$17 billion that Samsung Electronics announced in 2021 when it selected the Texas city of Taylor as the site of its new foundry.

The large-scale investment is expected to contribute greatly to expanding the company’s production base in Texas. In addition to its two new system semiconductor manufacturing fabs, R&D fab, and advanced packaging facility in Taylor, Samsung Electronics also plans to expand its existing plant in Austin.

It also plans to operate a 2-nanometer process at its new Taylor fab starting in 2026. Both TSMC and Samsung Electronics have set a goal of beginning mass production next year for the 2 nm semiconductors, which are produced through state-of-the-art ultra-fine processes.

By Lee Jae-yeon, staff reporter

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