Samsung proposes 11 Texas semiconductor plants worth $191 billion

Samsung has proposed the building of 11 new chip making factories in the Austin and Taylor areas of Texas, representing $191.2 billion of investment.

The proposals, published on the Texas comptroller’s website on Wednesday, mark a significant move by the South Korean manufacturing giant to corner the semiconductor market in the US, and would represent a sizeable investment in Texas' $2 trillion economy.

If approved, the facilities are expected to stimulate the local economy to the tune of 10,000 jobs. Approximately 1,800 of these jobs would be created in Austin, with the remaining 8,200 in Taylor.

It follows another major move by Samsung in Texas this year, with a $17 billion semiconductor facility in Taylor hoping to break ground in 2022. Just last month, Samsung identified Yates Construction, a Mississippi-based contractor, as the builder for this facility, which the company hopes will be operational in 2024.

Speaking to the Austin American Statesman, the executive director of the Austin Regional Manufacturers Association Ed Latson emphasised the scale of the proposal.

"Samsung's commitment and investment in this area are in a class of their own."

"We're talking about the largest foreign investment in the United States right here in our region. It's going [to] have a dramatic impact on the economic development and growth of Central Texas."

The documents published yesterday point to long-term expansion plans in Texas, with estimates that construction on the sites could begin between 2027-29. The proposals seek a Chapter 313 Agreement with the school boards of each area, an agreement named after a chapter in Texas tax law that states a taxpayer may agree to build property and create jobs in exchange for “a 10-year limitation on the taxable property value for school district maintenance and operations tax (M&O) purposes”.

In a statement to IT Pro, Samsung made clear that it is exploring options in the area without committal.

"We currently do not have specific plans to build at this time, however, the Chapter 313 applications to the State of Texas are part of a long-term planning process of Samsung to evaluate the viability of potentially building additional fabrication plants in the United States," said a spokesperson.

Texas is already established as a chip manufacturer, with semiconductors being the state’s 6th largest export in 2019, for a total of over $13.8 billion. Samsung is also well-established in the state, already operating a semiconductor facility that employs thousands of workers.

The expansion of localised semiconductor manufacturing is currently seen as a key goal in both the US and Europe. The EU continues to move ahead with its European Chips Act to accelerate the development of sites such as a planned €33 billion Intel facility in Germany.

Meanwhile, the US Congress is expected to pass a version of its own CHIPS Act soon, which seeks to provide $52 billion in grants for chip manufacturers in order to stimulate domestic production. Manufacturers have lobbied heavily for the funding, with Intel pausing construction on a planned facility in Ohio until the act is passed.

This article was updated to include a statement from Samsung.