Samsung set to begin work on $17bn Texas chip factory in the autumn

Korean tech company Samsung is planning to start work on a $17bn chip factory in Texas in the third quarter of this year, Reuters reports.

The factory, which is expected to be located in Austin, Texas, will make state-of-the-art, 5-nanometre circuits using ultraviolet lithography.

The plant is expected to begin operating in 2024. Its US customers will include Tesla, Qualcomm and Nvidia.

Reuters reported in March that the company was considering four sites in the US for the plant, two in Arizona, one in New York and one in Texas. It is understood that Travis County in Texas offered the company $1.5bn in tax abatements over 20 years in return for the creation of 1,800 jobs.

Samsung, which already has a chip factory in Austin, told Reuters that nothing had been decided.

Reuters noted that President Joe Biden had proposed $50bn to support chip manufacturing, which has spurred companies like Intel and Taiwan Semiconductor Manufacturing, the largest chip maker in the world, to consider major investments.

Chip manufacturing has emerged as one of the main battlegrounds between the US and China, who are trying to achieve technology independence from each other. At present, China imports $350bn worth of semiconductors each year, but is prioritising the development of its own industry.

In a White House meeting with business leaders, Biden quoted from a letter sent to him by 23 senators and 42 members of Congress saying: "The Chinese Communist Party aggressively plans to reorient and dominate the semiconductor supply chain."

Meanwhile, South Korea announced last week that it was planning to invest $450bn in tax benefits to its own chip making industry over the next 10 years, of which Samsung stands to gain $150bn.

The decision came a month after President Moon Jae-in hosted a meeting with executives in the semiconductor, auto and shipbuilding industries to discuss how to strengthen their global position.

Image: The US is encouraging semiconductor makers to invest in the country (Nordroden/Dreamstime)

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