Biden admin deal will give $6.4 billion to Samsung to boost chip production

[LAUREN TAYLOR]

A NEW PARTNERSHIP BETWEEN THE U.S. DEPARTMENT OF COMMERCE AND SOUTH KOREA’S SAMSUNG ELECTRONICS, ANNOUNCED MONDAY, AIMS TO POSITION THE U.S. AS A GLOBAL LEADER IN SEMICONDUCTOR TECHNOLOGY.

THIS AGREEMENT INCLUDES UP TO  6.4 BILLION DOLLARS IN FEDERAL GRANTS AND AN ADDITIONAL 40 BILLION DOLLARS FROM SAMSUNG.

THE MONEY WILL BE USED TO EXPAND CHIP PRODUCTION IN THE AUSTIN, TEXAS, REGION.

THE PROJECT WILL FOCUS ON ADVANCED MANUFACTURING, PACKAGING, AND RESEARCH, WITH SAMSUNG’S NEW PLANTS IN TAYLOR, TEXAS, PRODUCING THE MOST ADVANCED CHIPS IN THE WORLD.

ADDITIONALLY, IT WILL EXPAND SAMSUNG’S FACILITIES TO SUPPORT AEROSPACE, DEFENSE, AND AUTOMOTIVE INDUSTRIES.

THE MOVE COMES AS SAMSUNG OVERTAKES APPLE AS THE WORLD’S TOP SMARTPHONE SELLER, A CHANGE DRIVEN BY APPLE’S DECLINING SALES IN CHINA AND RIVAL PHONE COMPANIES LIKE HUAWEI COMPETING FOR MARKET SHARE.

PRESIDENT BIDEN DESCRIBED THIS INITIATIVE AS A RESPONSE TO SUPPLY CHAIN VULNERABILITIES — NOTING CONCERNS FROM LAWMAKERS ABOUT THE U.S.’S RELIANCE ON CHIPS MADE IN TAIWAN, GIVEN CHINA’S TERRITORIAL CLAIMS ON THE ISLAND AND ITS THREAT TO FORCE REUNIFICATION.

“This announcement will unleash over $40 billion dollars in investment from Samsung, and cement central Texas’s role as a state-of-the-art semiconductor ecosystem, creating at least 21-thousand 5-hundred jobs and leveraging up to $40 million dollars in CHIPS funding — to train and develop the local workforce.” said president biden.

IN A STATEMENT, THE U.S. SECRETARY OF COMMERCE SAID INVESTMENTS LIKE THIS ONE ARE DESIGNED TO HELP CREATE THOUSANDS OF JOBS TO FUEL THE INDUSTRY:

“The chips that Samsung will be making in Texas are important components to our most advanced technologies, from artificial intelligence to high-performance computing and 5G communications.”

LAST WEEK, THE COMMERCE DEPARTMENT ANNOUNCED SIMILAR GRANTS FOR T-S-M-C’S NEW PLANT IN PHOENIX, AND FOR U.S. CHIPMAKER INTEL IN SANTA CLARA, CALIFORNIA.

SAMSUNG EXPECTS THE NEW PLANT TO START PRODUCTION IN 2026 AND AIMS TO MANUFACTURE 20 PERCENT OF THE WORLD’S LOGIC CHIPS BY 2030.