Updated September 1, 2024: Samsung Electronics is resuming construction on its massive semiconductor plant in Taylor, Texas, after halting progress in 2024 due to a slowdown in global chip demand. Backed by a fresh $4 billion investment, the project will fund critical manufacturing equipment worth $2.87 billion and drive a major hiring push. Samsung plans to onboard engineers in two phases, starting in September and continuing in November, while a dedicated project head will oversee the build. This restart underscores Samsung’s commitment to strengthening its U.S. presence. In addition, advancing chip production at a time when demand for cutting-edge semiconductors is surging.
Tesla Deal Drives Strategic Shift and Local Growth
The renewed momentum is directly tied to Tesla’s contract with Samsung for next-generation 2nm chips. This move that provides the demand certainty needed to justify expansion. These advanced semiconductors will power future electric vehicles and AI systems, positioning the Texas plant at the center of U.S. technology growth. Beyond bolstering the American semiconductor supply chain, the facility is expected to generate thousands of high-tech jobs. Furthermore, it will deliver long-term economic benefits to the region. With production focused on Samsung’s most advanced SF2P process, the Taylor fab marks a pivotal step in both the recovery of the semiconductor industry and the future of innovation in the United States
Written August 14, 2021: Samsung has made the final decision to construct its new EUV semiconductor factory in Austin, Texas. The company announced that it had looked into New York, Arizona, and Texas and decided that Texas would be best. The tech giant is yet to announce all its plans for the 5nm EUV facility. However, there is speculation that the company will be announcing their plans on May 21 during South Korea and America’s meeting between both their presidents at the white house. Samsung just temporarily closed its chip manufacturing facility in Austin due to harsh weather. The new factory will be equipped with 5nm EUV-based manufacturing lines. Therefore, it will be responsible for creating Samsung’s future innovative chipsets.
Original Planned Date for Operation
The company plans to have the new factory fully operational by 2024. The budget for construction being set at US$18 billion. This is nearly twice as much as it was reported at the beginning of the year. It has been estimated that the new site will create around 1,800 new jobs. The US President, Joe Biden has announced a proposal for US$50 billion to support chip manufacturing which has encouraged tech companies such as Taiwan Semiconductor Manufacturing Co and Intel Corp to consider investing in the country.
The company also recently saw a large drop in its semiconductor business in the first quarter of 2021 partly due to the shutting down of the Austin factory. It was also due to the decline in NAND prices and the initial costs of a new line for the latest process node. Some American fabless companies who are in need of semiconductor foundries have reportedly grown more reluctant towards signing long-term agreements with the South Korean-based company. They claim it is because it maintains two-way diplomacy with both China and the US. This therefore there’s a higher risk of the supply chain being disrupted by political events. Elsewhere in the United States, Micron Technology revealed plans to build a second Leading-Edge Memory Manufacturing Fab in Boise, Idaho. This move, expanding its manufacturing footprint, is part of an expansive $200 billion U.S. investment program aimed at boosting domestic semiconductor production and R&D.
Project Factsheet
Location: Taylor, Texas (shifted from an initial 2021 plan for Austin).
Current Status: Construction resumed in September 2024 after a temporary halt due to a global chip demand slowdown.
Renewed Investment: A fresh $4 billion has been injected to resume the project.
Key Driver: A new contract with Tesla for next-generation 2nm chips provides demand certainty.
Technology Focus: The plant will produce advanced 2nm chips using Samsung’s SF2P process for EVs and AI systems.
Strategic Goal: To strengthen the U.S. semiconductor supply chain and boost domestic chip production.
Hiring Push: Samsung is launching a major hiring initiative for engineers in two phases, starting September 2024.
Job Creation: The project is expected to generate thousands of high-tech jobs in the region.
Equipment Costs: $2.87 billion of the new investment is specifically allocated for critical manufacturing equipment.
Original Plan: The initial 2021 plan involved an $18 billion, 5nm EUV facility intended to be operational by 2024.
Economic Impact: The facility is positioned to deliver significant long-term economic benefits and advance U.S. technological innovation.
