Biden admin agrees to provide $6.4B to Samsung for making chips in Texas
The White House is seen as dusk falls, Sunday, April 14, 2024, in Washington. (AP Photo/Jacquelyn Martin)
WASHINGTON — The Biden administration has reached an agreement to provide up to $6.4 billion in direct funding for Samsung Electronics to develop a computer chip manufacturing and research cluster in Texas.
The funding announced Monday by the Commerce Department is part of a total investment in the cluster that, with private money, is expected to exceed $40 billion. The government support comes from the CHIPS and Science Act, which President Joe Biden signed into law in 2022 to revive the production of advanced computer chips domestically.
READ: Biden signs bill to boost U.S. chips, compete with China
“The proposed project will propel Texas into a state-of-the-art semiconductor ecosystem,” Commerce Secretary Gina Raimondo said on a call with reporters. “It puts us on track to hit our goal of producing 20 percent of the world’s leading-edge chips in the United States by the end of the decade.”
Raimondo said she expects the project will create at least 17,000 construction jobs and more than 4,500 manufacturing jobs.
Samsung’s cluster in Taylor, Texas, would include two factories that would make four- and two-nanometer chips. Also, there would be a factory dedicated to research and development, as well as a facility for the packaging that surrounds chip components.
The first factory would begin production in 2026, with the second starting in 2027, according to the government.
Funding for new plants, expansion project
The funding would also expand an existing Samsung facility in Austin, Texas.
Lael Brainard, director of the White House National Economic Council, said Samsung will be able to manufacture chips in Austin directly for the Defense Department as a result. Access to advanced technology has become a major national security concern amid competition between the U.S. and China.
READ: Samsung picks Texas as location of new $17 billion chip plant
In addition to the $6.4 billion, Samsung has indicated it will also claim an investment tax credit from the U.S. Treasury Department.
The government has previously announced terms to support other chipmakers including Intel and Taiwan Semiconductor Manufacturing Co. in projects spread across the country.
