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Samsung Reportedly to Build $17 Billion Chip-Making Plant in Texas

Samsung reportedly will build a $17 billion chip-making plant in Taylor, Texas, as the Biden administration pushes for more U.S. semiconductor production.

Samsung Electronics will build a roughly $17 billion chip-making plant in Taylor, Texas, as the Biden administration pushes for an expansion of U.S. semiconductor production, the Wall Street Journal reported on Tuesday.

Citing people familiar with the company's and the state's plans, the facility would create around 1,800 jobs, with chip production expected to start towards the end of 2024.

An announcement could come as early as Tuesday afternoon. Texas Gov. Greg Abbott is scheduled to make an “economic announcement” Tuesday at 5 p.m. local time.

The pending reveal comes as manufacturers around the world continue to struggle with a global chip shortage that has affected everything from cars and video games to home appliances for nearly two years.

Samsung executives alongside Apple  (AAPL) - Get Apple Inc. (AAPL) Report, Intel  (INTC) - Get Intel Corporation (INTC) Report, Microsoft  (MSFT) - Get Microsoft Corporation (MSFT) Report, General Motors  (GM) - Get General Motors Company (GM) Report, and Ford  (F) - Get Ford Motor Company Report leaders were some of the big names that attended a virtual meeting hosted by Secretary of Commerce Gina Raimondo in September to explore ways to minimize the impact of the pandemic on chip supplies.

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According to an early-November report from the South China Post, the worldwide semiconductor supply shortage “is among the most urgent issues the U.S. government is focused on,” said Matt Murray, a senior official in the Bureau of Economic and Business Affairs at the State Department.

To woo Samsung to central Texas, Taylor offered incentives that include the equivalent of property-tax breaks of up to 92.5% for the first 10 years, with the write-offs gradually declining over the next several decades, the Journal reported.

Samsung, the world’s largest semiconductor maker by revenue, plans to invest more than $205 billion over the next three years, the Journal said. Taiwan Semiconductor Manufacturing  (TSM) - Get Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR Report has set aside some $100 billion over the next three years to build new chip factories, while Intel has also unveiled more than $100 billion worth of semiconductor factory investments plans in the U.S. and Europe, according to the Journal.

Amping up U.S. production of chips has been a priority for both the Biden administration and Congress. The Senate in June approved $52 billion in direct industry subsidies for new semiconductor-making factories, though the House has yet to take action.