Samsung is considering spending upward to $10 billion on building its most advanced logic chip-making plant in the US. This FDI will not only increase the attraction that Samsung and many desires, but also will curb the unemployment issue the US has been facing. This move will help Samsung catch up with its rival Taiwan Semiconductor Manufacturing (TSMC).
Currently, the world’s largest chipmaker and smartphone maker is in discussion to locate a facility in Austin, Texas capable of fabricating chips as advanced as 3 nm. Plans and proceedings are subject to change. However, if all go well installation of major equipment may start by 2022 and operation would begin by 2023.
Samsung is betting on an opportunity that the US markets created when they tried to counter China’s rising economic ability and make new strides for which Samsung has been famous in Asia. The plant will be one of the kinds in the US to use ultraviolet lithography, a new standard of silicon-based products.
If Samsung makes the plunge, it will effectively go head-to-head with TSMC, which is also on track and with the collaboration of Amazon to build a $12 billion plant in Arizona by 2024. Samsung plans to invest more than $116 billion into the industry valued at $400 billion.
It already dominates the market as it counts Qualcomm and Nvidia Corp as customers. To close the deal, it would have to negotiate with President Biden’s administration. Tax benefits and subsidiaries will lessen the burden Samsung will face when setting the plant. But the company will still go ahead if major incentives are not adhered to.
TSMC has already spent $28 billion to ensure it remains the only forefront for both the technology and sheer storage. Processors are more complicated to manufacture as aligned with memory. Their production yields are also harder to control. But the Korean Megan giant can draw the motivation from Nvidia for whom it worked on the new RTX 30 ampere-based graphic cards.