The U.S. Commerce Department has awarded a $6.4 billion grant to Samsung Electronics to build an advanced semiconductor fab capabilities in Tyler, Texas.

The move follows a $6.6 billion grant awarded to Taiwan based TSMC to build advanced semiconductor fab capabilities in Arizona.

As noted in a prior Supply Chain Matters semiconductor supply chain commentary, The Wall Street Journal had previously reported that Samsung Electronics would be doubling its planned U.S. chip production presence in Texas, in a complex just outside of Austin.

According to the U.S. Commerce Department, the two fabs being planned in Taylor, Texas will produce both 4-nanometer and 2-nanometer generation technology for Samsung’s contract foundry business. Further being planned is a chip-packaging facility that can support 3-D packaging for high bandwidth memory (HBM) production needs. HBM is reportedly considered integral to advanced artificial intelligence computing needs, including chips designed by Nvidia.

As in prior grants, this government funding is reportedly contingent upon due diligence and milestone performance monitored by the Commerce Department.

According to yesterday’s reporting by The Wall Street Journal (Paid subscription), the selling point for Samsung’s U.S. based production investments is the ability to streamline both cutting-edge advanced processor chips along with the packaging of HBM based memory needs.  The aim is the ability to support the strategic supply needs in domestic based aerospace and defense, artificial intelligence and automotive supply networks.

Reportedly, Samsung is planning to have the two fabrication facilities to be operational in 2026 and 2027.

Under the provisions of the U.S. CHIPS Act, and in addition to the Samsung Electronics grant, the Commerce Department has awarded a cumulative $23 billion in grants. The consist of a $6.6 billion grant to TSMC, upwards of $8.5 billion to Intel, and $1.5 billion to Global Foundries.

 

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