South Korean tech giant Samsung has decided on the city of Taylor, Texas as the location of its $17 billion semiconductor gigafactory, the company revealed last week.
Gregg Abbott and Samsung Electrics CEO Kinam Kim. Credit: Samsung
Texas Senator John Cornyn, Governor Greg Abbott, Samsung Electronics Vice Chairman & CEO Kinam Kim at the announcement of the site. Credit: Samsung
The plant will aid in creating "next-generation" chips in a bid to bolster US semiconductor supply chains as part of nationwide initiatives to tackle the ongoing semiconductor shortage.
Taylor previously offered Samsung significant income tax cuts should it be chosen as the location of its new chip plant. When complete, it will be the company's second plant in the state, with Samsung already operating chip fabs in Austin.
Read more: Texas offers tax breaks for Samsung's $17bn gigafactory
"As we add a new facility in Taylor, Samsung is laying the groundwork for another important chapter in our future,” said Kinam Kim, Vice Chairman and CEO, Samsung Electronics Device Solutions Division.
“With greater manufacturing capacity, we will be able to better serve the needs of our customers and contribute to the stability of the global semiconductor supply chain", he added.
The plant could stand to create as many as 1,800 new jobs and increase the US's domestic production of semiconductors, which forms part of President Joe Biden's pledge to tackle the shortages at home.
Construction on the plant is expected to commence in 2022, with operations set to commence in 2024. The Taylor site will span more than 5 million square meters and is expected to serve as a key location for Samsung’s global semiconductor manufacturing capacity along with its latest new production line in Pyeongtaek, South Korea.
Kim added: “In addition to our partners in Texas, we are grateful to the Biden Administration for creating an environment that supports companies like Samsung as we work to expand leading-edge semiconductor manufacturing in the U.S.
“We also thank the administration and Congress for their bipartisan support to swiftly enact federal incentives for domestic chip production and innovation".
Samsung claims there were four major reasons why it selected Texas as the location for its new fabs, including the proximity to Samsung's existing plant, a vibrant semiconductor ecosystem, support from local authorities and community development opportunities.
The news comes as Samsung celebrates chipmaking in the US for 25 years. It currently employs over 20,000 people across the nation.
Texas continues to be a hotbed for the industry, particularly the tech sector. Other major players, such as AMD, Intel and Silicon Labs, continue to operate in the region owing to what governer Greg Abbott refers to as its "world-class business climate and exceptional workforce".
“Samsung’s new semiconductor manufacturing facility in Taylor will bring countless opportunities for hardworking Central Texans and their families and will play a major role in our state’s continued exceptionalism in the semiconductor industry. I look forward to expanding our partnership to keep the Lone Star State a leader in advanced technology and a dynamic economic powerhouse", he added.
Samsung has been planning a string of significant investments in a bid to increase its post-pandemic output.
Read more: Samsung eyes $200bn investment for post-pandemic growth
It is planning on investing the equivalent of around $200 billion in a post-Covid stimulus scheme, which will also see it push into the biopharmaceutical sector, while also making advances in AI tech and 5G.
The group also revealed its plans to push for greater growth through mergers and acquisitions.
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