How much in subsidies will Samsung Electronics get for US chip plant?

The construction site of Samsung Electronics semiconductor plant  in Taylor, Texas, Jan. 2 / EPA-Yonhap

Samsung Electronics is expected to receive more than $6 billion in subsidies from the U.S. government for its semiconductor investments in the country, marking its entry into the heated competition for chip investments alongside Intel and TSMC, according to media reports on Tuesday.The U.S. Department of Commerce on Monday revealed its support for chip factories by foundry company TSMC with grants totaling $6.6 billion, along with a $5 billion loan. This marks an increase of over 30 percent from the initially expected amount.The sizable support stems from the CHIPS and Science Act, a chip subsidy program enacted in 2022 aimed at incentivizing companies to construct new semiconductor factories in the U.S.Such substantial favors do not come without obligations. Taiwanese chip company TSMC announced its intention to increase its investment from $40 billion to $65 billion. Additionally, it plans to construct a third plant in Arizona by 2030.The announcement regarding subsidies for Samsung is anticipated to be made next week, with foreign media speculating that the Korean chip giant is likely to receive between $6 billion and $7 billion in subsidies. In 2021, Samsung declared its intention to invest $17 billion to construct a new foundry plant in Texas, which is presently under construction.

In response to Washington’s subsidy support surpassing expectations, much like TSMC’s reaction, Samsung is also anticipated to escalate its investment in the U.S. to over $44 billion, as reported by Reuters.Should Samsung secure such support, it would mark the third-largest contract with the U.S. government, trailing only behind Intel and TSMC. Last month, the Joe Biden administration unveiled plans to allocate $8.5 billion in subsidies and $11 billion in loan support to Intel. In light of this, Intel intends to invest upwards of $100 billion over the next five years.Washington has said the support scheme aims to bring back semiconductor manufacturing to U.S. soil, addressing the current overconcentration in Asia. The objective is to produce 20 percent of the world’s most advanced semiconductors in the U.S. by 2030.Analysts perceive Samsung’s involvement in the U.S. strategy to enhance its chip capability as advantageous for the company. This move allows Samsung to establish local production bases, enhancing its ability to cater to the demand of its U.S. customers, particularly those specializing in AI chips.”Samsung Electronics is currently building a foundry plant in Texas, and it will proceed with additional investments to increase its production facilities in the U.S. This will increase its touchpoints with U.S. chip design customers and enhance the competitiveness of Samsung’s foundry business,” an official in the domestic chip industry said on condition of 슬롯사이트 anonymity.

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