Samsung to start construction of Texas chip plant in June

Construction of a new Samsung Electronics chip plant in Taylor, Texas will begin next month, according to the city government and the Korean chipmaker, marking the start of the $17-billion project.

The site for Samsung Electronics' new chip manufacturing facility in Taylor, Texas [CITY OF TAYLOR]

Construction of a new Samsung Electronics chip plant in Taylor, Texas will begin next month, according to the city government and the Korean chipmaker, marking the start of the $17-billion project.

The Taylor city government gave an update on the construction of the plant, which will cover 138 acres on a 1,000-acre plot of land in the city, in a recent newsletter.

“Underground utilities and building foundations are expected to start in June,” it said.

The government noted that site grading is almost complete and interior roads and parking lot paving is now underway.

A Samsung spokesperson confirmed the update, but said an official ground-breaking ceremony has not yet been scheduled.

The chipmaker is already behind schedule. According to a document filed with the Texas Comptroller office, Samsung said it plans to break ground by the first quarter of 2022 with the aim of operating the plant by the final quarter of 2024.

When completed, the chipmaker will produce advanced processors needed for systems like 5G, artificial intelligence and high-performance computing.

The move came as competing chipmakers are ramping up production capacity for semiconductors amid a prolonged shortage of chips — especially processing chips like application processors used in cars and smartphones and microcontroller units for cars.

TSMC broke ground on its new plant in Phoenix, Arizona last year, while Intel also began expanding on its existing facility in the same region last year.

Both projects are due to be completed by 2024.

In the meantime, Samsung Electronics filed an application for a soon-to-expire tax incentive program in Texas.

Texas-based local media said that the chip manufacturer submitted an application for the tax program, called Chapter 313, ahead of the June 1 deadline.

They said that the application indicates that Samsung Electronics could make a new round of investments in Texas, where it already operates a chip manufacturing plant in Austin.

Samsung Electronics struck a more cautious tone.

“While we do not have specific plans to build at this time, the Chapter 313 application process is part of our long-term planning to evaluate the viability of potentially building additional fabrication plants in the U.S," a spokesperson at Samsung Electronics said.

BY PARK EUN-JEE [park.eunjee@joongang.co.kr]