Samsung Electronics Co. is preparing to end a $44 billion investment in U.S. chipmaking as early as next week, a key project in Washington’s broader effort to bring semiconductor manufacturing back to America.
The world’s largest memory chip maker plans to outline the project in Taylor, Texas, along with Commerce Secretary Gina Raimondo, according to people familiar with the matter. It has secured more than $6 billion in U.S. government grants for an investment outlay that has increased significantly to a total of $44 billion over several years, the sources said. The timing and details of the announcement could still change before it is finalized, the people said, asking not to be identified discussing private matters.
The award is the latest in a series of multibillion-dollar donations from the Biden administration, which is using the Chips and Science Act of 2022 to try to revitalize American chip manufacturing after decades of shifting production to Asia. The broader program also aims to counter the technological rise of China, which is building its own domestic semiconductor industry.
The Chips Act, which provided $39 billion in grants plus $75 billion in loans and guarantees, spurred well over $200 billion in private investment in semiconductors. Intel Corp. got nearly $20 billion in grants and loans. Taiwan Semiconductor Manufacturing Co., the top chipmaker for Nvidia Corp. and Apple Inc., got $11.6 billion. It’s unclear whether Samsung will get loans on top of the more than $6 billion in government grants.
Samsung’s project adds to a robust semiconductor ecosystem in Texas, including tens of billions of dollars in additional investment from Texas Instruments Inc. in its home state and Samsung’s existing factory in Austin. It’s unclear when Taylor’s site will begin mass production, after a reported delay last year. Company representatives declined to comment.
Next week’s announcement will kick off a month-long due diligence period during which Samsung and the Commerce Department will finalize the final terms of their agreement. The money will then be disbursed as the project reaches key construction and production milestones, with the possibility of clawbacks if the company fails to deliver on its promise.