Samsung Might Build a $17 Billion Semiconductor Facility in America

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Interestingly TSMC, one of Samsung’s competitors, is also building a semiconductor fab in USA

Samsung Electronics is planning to invest nearly $17 billion in building a semiconductor facility in the USA. A report by Bloomberg mentions that the company might invest approximately $5.1 into buildings and the around $9.9 billion in buying equipment required. The report also mentions that the Korea-based technology giant is also in the process of evaluating other sites for this semiconductor plant which include some in Korea and others in USA’s Arizona and New York.

Interestingly TSMC, one of Samsung’s competitors, is also building a semiconductor fab in USA. In fact the company has already received government approval to go ahead with the first phase of a new plant in the U.S. state of Arizona with an initial investment of $3.5 billion.

It is a part of a plan TSMC had announced in May 2020 to build a $12 billion factory in Arizona. The company plans to set up a 12-inch wafer fabrication plant in Phoenix, Arizona. It is expected to start volume production in 2024, Taiwan’s investment commission of the ministry of economic affairs had said earlier in a statement. TSMC currently manufactures the bulk of its chips in Taiwan and has older chip facilities in China and Washington.

$116 billion budget

Samsung, as reported earlier, is gearing up for semiconductor wars with a humongous $116 billion budget. A report published in the Bloomberg had earlier noted that the company has allocated this budget to be used in next two years specifically for the development of 3nm silicon semiconductor chips.

It is worth mentioning here that the only 5nm chip available in the world right now, capable of powering an entire laptop, comes from the house of Apple’s ARM. The South Korea headquartered giant might be planning to take on the likes of TSMC.

USA’s recently elected President Joe Biden is seeking $37 billion in funding to rescue the ailing chip manufacturing industry in the United States. The president of America has also signed an executive order meant to address the global chip shortage. This shortagehas alarmed the White House as well as America’s Congress.

The share of global semiconductor manufacturing capacity in the U.S. has decreased from 37 per cent in 1990 to 12 per cent today (Semiconductor Industry Association Report). U.S. semiconductor companies, on the other hand, account for 47 percent of global chip sales.

This decline,as per SIA, is largely due to substantial subsidies offered by the governments of USA’s global competitors, which have placed the U.S. at a competitive disadvantage in attracting new construction of semiconductor manufacturing facilities, or “fabs.”

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