Samsung to build $17 billion chip factory in Texas

Samsung is planning to build a microchip factory in Texas, a $17 billion investment that comes as semiconductor shortages are causing supply chain delays across many industries.

Welcome to Texas, Samsung! Greg Abbott, Texas's Republican governor, said the planned factory would be the largest foreign direct investment in Texas EVER. Kinam Kim, CEO of the South Korean giant's electronics division, said that the plant is expected to be operational by the end of 2024 and is expected to create more than 2,000 skilled jobs and lay the groundwork for another important chapter in our future.

The chips manufactured on the site will have applications in mobile technologies, 5 G or even artificial intelligence, the group said. The plant will be built in the town of Taylor, near the capital Austin.

The news was welcomed by President Joe Biden's administration, whose economics and security advisors Brian Deese and Jake Sullivan said in a statement that the plant would go a long way to protecting our supply chains, revitalizing our manufacturing base and creating good jobs right here at home. Samsung, the world's biggest memory chipmaker, has stepped up its investment in its semiconductor business as the world battles chips shortages that have hit everything from cars and home appliances to phones and gaming consoles.

Samsung joined TSMC from Taiwan and Intel in expanding chip manufacturing capacity in the United States, which sees the sector as an area of strategic competition with China. TMSC and Intel are building such plants in Arizona.

The two presidential advisers stressed that Tuesday's announcement was in large part the result of discussions between the heads of state of the two countries.

Samsung, which has been operating in the United States for 25 years, had filed documents for the project with Texas last January.

The Texas plant announcement came as Lee Jae-yong, the de facto leader of the larger Samsung conglomerate, visited the United States, looking to boost its footprint in the world's biggest economy.

In the last quarter, Samsung has enjoyed soaring profits due to strong pandemic-driven demand for electronics and chips.

Since coming to power, Biden has tried to rally the industry around the need to produce vital components in the United States.

In the last few months, a number of firms have announced new plants. In partnership with Sony, TSMC announced that it would build a plant in Japan. In September of this year, China's biggest chipmaker said it would build a new factory in Shanghai.

The US semiconductor giant Intel will invest $20 billion in two new plants in Arizona this year and plans to allocate between 20 billion euros $22.5 billion and 80 billion euros for microchips in Europe over the next 10 years.