Samsung is Unlikely to Begin Production of 4-nm Chips in Texas Before End of the Year

US ‘Chip Law’ 2022 Disbursement’s Delay Concerns Potential Recipients

The funding distribution from the ‘Chip Law’ passed in the US in 2022 is due to begin in the current quarter, but this timeline may not meet the needs of potential recipients. Even Samsung fears failing to adhere to the schedule for the construction of a new chip contract manufacturing facility in Texas.

Unexpected Delays in Samsung Texas Facility Construction

Business Korea reports that during a regular session of the Williamson County court, where the new Samsung Electronics facility is being constructed, Judge Bill Gravell stated that manufacturing-related staff should begin work by July 1 this year at the latest. Because the Texas state authorities granted local subsidies independent of the federal government, they have the right to demand Samsung meet specific timelines. Samsung Electronics representatives, however, warned that various factors could hinder their ability to meet this requirement, and a July 1st start date for their new Texas facility’s workforce cannot be guaranteed.

Production Delays Forward

Typically, the recruitment and preparation of personnel for chip manufacturing at a new facility commences six months prior to the actual start of production. If Samsung’s preparatory work begins later than July 1, the launch of their 4-nm products could be deferred until next year. For comparison, TSMC’s construction of their Arizona facilities has been delayed by at least a year from their original schedule. Intel, reportedly, is also waiting for subsidies from the US government before proceeding with the construction of two state-of-the-art facilities costing $20 billion in Ohio. Though there is no official evidence of such delay in Samsung’s Texas project, some uncertainty persists.

Samsung’s Investment Plans

Samsung Electronics plans to invest $17 billion in the construction of a facility in Taylor, Williamson County. However, the company announced last year that it intends to invest an additional $24.5 billion over the next 20 years in the development of its Austin facility complex and $167.6 billion in the development of facilities in Taylor. In total, over this period, the South Korean company could construct 11 chip manufacturing facilities in Texas.