[News] The US Administration Rumored to Announce USD 7 Billion Grant for Samsung to Boost Chip Capacity

2024-04-10 Semiconductors editor

Following grants to Intel and TSMC, the US administration reportedly plans to announce next week a USD 6 to 7 billion subsidy to Samsung for constructing a semiconductor fab in Taylor, Texas, aimed at increasing chip production capacity.

According to sources cited by Reuters, this funding initiative, set to be announced by U.S. Commerce Secretary Gina Raimondo, will back four projects at Samsung’s site in Taylor, Texas. These projects include a previously disclosed USD 17 billion chip manufacturing plant, along with an additional plant, an advanced packaging facility, and a research center.

Furthermore, the plan involves Samsung’s investment in another undisclosed location. As part of the deal, Samsung’s investment in the U.S. is projected to more than double, exceeding USD 44 billion.

In 2022, the U.S. Congress passed the CHIPS and Science Act, allocating USD 52.7 billion for research and manufacturing grants, alongside USD 75 billion in government loans, aimed at boosting American semiconductor production and reducing reliance on China and Taiwan. As per the Semiconductor Industry Association (SIA), the U.S. share of global semiconductor manufacturing capacity declined from 37% in 1990 to 12% in 2020.

Samsung is poised to become the third-largest recipient of subsidies under the semiconductor act, following TSMC. The US administration is set to provide USD 6.6 billion in aid to TSMC, which plans to build a third chip plant in Arizona with a total investment of USD 65 billion.

According to the latest information released by TSMC, Arizona’s first fab is on track to begin production leveraging 4nm technology in first half of 2025. The second fab will produce the world’s most advanced 2nm process technology with next-generation nanosheet transistors in addition to the previously announced 3nm technology, with production beginning in 2028.

The third fab will produce chips using 2nm or more advanced processes, with production beginning by the end of the decade. Each of the three fabs, like all of TSMC’s advanced fabs, will have cleanroom area approximately double the size of an industry standard logic fab.

Previously, the U.S. government announced that Intel would receive USD 8.5 billion in federal subsidies and USD 11 billion in loans. Intel is planning to invest USD 100 billion across four states in the U.S. for building and expanding fabs, and is also seeking an additional USD 25 billion in tax credits.

Regarding the rumored subsidy to Samsung, the U.S. Department of Commerce, Texas Governor Greg Abbott’s office, and Samsung have declined to comment on the matter.

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Please note that this article cites information from Reuters.