South Korean tech giant Samsung has revealed it will be investing $206 billion (€175 billion) - roughly 240 trillion won - into a post-pandemic stimulus scheme as the company looks to recover from the effects of both the chip shortage and the Covid-19 crisis.
Samsung logo. Credit: Salva de Castro-Palomino Terra / Flickr (Licence: CC2)
This marks Samsung's largest investment since 2018. Credit: Salva de Castro-Palomino Terra / Flickr (Licence: CC2)
The company will be pushing into the biopharmaceutical sector while attempting to make advances in AI tech, increased semiconductor manufacturing and expansion into the robotics business.
The company has already pledged $17 billion (€14.5 billion) to a new chip factory in the US but will continue to stimulate growth through mergers and acquisitions.
Read more: Samsung considering 4 US sites for $17b chip plant
Samsung previously announced a three-year plan in 2018 in order to help fuel its expansion into the technology sector. This new plan is roughly 30% larger in terms of investment, with the former clocking in at $154 billion (€131 billion) - or 180 trillion won.
The semiconductor shortage has been ravaging the global automotive and electronics sectors all year. Current estimates predict the crisis will continue into 2022.
Several major automakers have had to cut production on their vehicle lines owing to supply bottlenecks, which has hindered their ability to meet the slowly increasing demand for electric vehicles, as many nations have opted to push towards greener engines as part of their pandemic recovery schemes.
Samsung is to increase production of its in-house chips while continuing to experiment with the types manufactured as it hopes to increase its competitiveness within the market.
"The chip industry is the safety plate of the Korean economy", the company said in a statement. "Our aggressive investment is a survival strategy in a sense that once we lose our competitiveness, it is almost impossible to make a comeback."
A number of tech and computing giants have offered investment into increasing domestic production of chips in order to allow for a number of nations to become independent of the supply, which primarily comes from East Asian suppliers.
Read more: Intel offers $20bn chip investment for EU
Both the EU and the US, among others, have pledged to tackle the semiconductor shortage as a matter of national emergency due to their importance in the digital transformation and energy transition.
This comes as a number of automakers reveal their plans to hasten the manufacturing of greener engines in the wake of the Covid pandemic as government and businesses look to decrease their respective carbon footprints.
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