Samsung considering 4 US sites for $17B chip factory

Samsung is considering four sites in the U.S., including in Austin, Texas, for a $17 billion semiconductor, or chip, factory, according to documents filed in Texas. 

The South Korean company revealed that it is reviewing one site in Austin in addition to two sites in Arizona and one in New York for the “highly competitive project.” Each location is proposing property tax abatement and “significant grants and/or refundable tax credits,” the company wrote in a document filed in Texas on Feb. 26.

Samsung said it would commit $17 billion to Project Silicon Silver, including almost $5.1 billion in buildings and property improvements and more than $9.9 billion in machinery and equipment. 

In an economic impact study, a local consultant, Impact DataSource LLC, in Texas predicted the project will create 1,800 jobs over the first decade. The construction of the factory would be expected to back $8.9 billion in gross area product and 19,873 jobs. 

The study forecasted that a new facility in Austin would bring 1,626 new residents, including 542 new workers, to the area. 

The property tax abatements would amount to approximately $1.5 billion over two decades for both the city and the county. The study also predicted the economic output, both direct and indirect, would reach about $8.6 billion.

Samsung already has one chip plant in Austin, which was ordered to temporarily stop production amid the recent power outages and the severe winter storm in the state. 

“Because of its strong ties to the local community and the successful past 25 years of manufacturing in Texas, Samsung Austin Semiconductor would like to continue to invest in the city and the state,” Samsung’s study said.

If the Austin site is confirmed, Samsung expects to start construction on the facility in 2021 and to have it running by the end of 2023, according to a January filing obtained by Bloomberg News.

Samsung spokesperson Michele Glaze said in a statement Wednesday evening that “no decision has been made at this time.”

“While we do not have specific plans to build a new fab at this time, we are constantly exploring various opportunities for business development so that we are ready when such opportunities arise,” she said. “As such, we have filed an application with the Comptroller’s Office for a Chapter 313 and entered into conversations with other site locations to remain strategically flexible in making business decisions.”

The announcement comes as President Biden’s administration has prioritized improving the supply chain for semiconductors as the world deals with a shortage. He signed an executive order last week to launch a review of the supply chain for chips, as well as other products including large-capacity batteries and pharmaceuticals.

Updated at 8:07 p.m.