In a significant step for the U.S. semiconductor industry, Samsung, Texas Instruments, and Amkor have finalized their funding agreements under the CHIPS and Science Act, marking a major milestone in the government’s efforts to bolster domestic chip manufacturing. These agreements, announced in late December 2024, will support the companies’ expansion plans in Texas, Utah, and Arizona, contributing to the growth of the semiconductor sector and strengthening the United States’ position in the global tech race.
Overview of the CHIPS Act Funding for Samsung, Texas Instruments, and Amkor
The U.S. Department of Commerce has awarded significant funding to three major semiconductor companies: Samsung, Texas Instruments, and Amkor. Samsung is set to receive $4.745 billion, Texas Instruments will receive $1.61 billion, and Amkor is allocated $407 million. These funds will support large-scale investments and the development of advanced semiconductor manufacturing facilities in various U.S. states.
The CHIPS and Science Act, passed with the aim of reducing U.S. dependence on foreign semiconductor supply chains, has spurred considerable investments in domestic manufacturing. This is crucial for ensuring a stable supply of semiconductors, particularly in high-demand sectors like AI and national security.
Samsung’s $37 Billion Investment in Texas
Samsung’s funding of $4.745 billion is part of its broader $37 billion investment in Texas, where the company plans to build two new semiconductor fabrication plants and an R&D center in Taylor, Texas. This project has encountered delays, with the timeline for mass production at the Taylor site being pushed from 2024 to 2026. Despite this, the U.S. Department of Commerce has committed to disbursing the funds based on the completion of project milestones, although specific milestones have yet to be disclosed.
Samsung’s expansion in Texas is a significant part of the U.S.’s strategy to become a global hub for semiconductor manufacturing. The decision to invest in the Taylor facility highlights Samsung’s commitment to maintaining a leading edge in semiconductor technology, and the project is expected to create thousands of high-paying jobs in the region.
Texas Instruments’ Investment in Sherman and Lehi
Texas Instruments will receive $1.61 billion to support its $18 billion investment in semiconductor manufacturing. This funding will help establish two new fabs in Sherman, Texas, and one in Lehi, Utah. The Sherman fabs will produce essential chips, particularly in the 65nm to 130nm range, critical for a variety of industries. Meanwhile, the Lehi site will focus on 28nm to 65nm analog and embedded processing chips, further expanding Texas Instruments’ capacity to meet the growing demand for chips across different sectors.
The expansion of Texas Instruments’ manufacturing capabilities in the U.S. is a strategic move to ensure a steady domestic supply of semiconductors, supporting both national interests and the needs of various tech industries.
Amkor’s Investment in Arizona
Amkor Technology has secured $407 million in CHIPS Act funding to support its $2 billion investment in a new outsourced semiconductor assembly and test (OSAT) plant in Peoria, Arizona. This facility will focus on advanced packaging and testing, an essential part of the semiconductor manufacturing process.
The Peoria plant will play a crucial role in supporting the global supply chain for semiconductor packaging. Amkor’s agreement with TSMC, announced in October 2024, to provide advanced packaging and testing services further underscores the importance of this plant to the semiconductor ecosystem.
TSMC and Other Semiconductor Companies’ CHIPS Act Agreements
In addition to Samsung, Texas Instruments, and Amkor, the U.S. government has finalized CHIPS Act funding agreements with other major players in the semiconductor industry. Taiwan Semiconductor Manufacturing Company (TSMC), for example, will receive $6.6 billion to support the construction of three fabs in Phoenix, Arizona. These fabs will produce cutting-edge 4nm, 3nm, and 2nm semiconductors, contributing to the production of the most advanced chips required for AI and other emerging technologies.
Other companies like SK Hynix, GlobalFoundries, Intel, Micron, and GlobalWafers have also secured substantial funding, positioning the U.S. as a global leader in semiconductor manufacturing.
Impact of the CHIPS Act on U.S. Semiconductor Industry
The CHIPS and Science Act is set to transform the U.S. semiconductor industry. The agreements finalized with Samsung, Texas Instruments, Amkor, and other companies represent a collective effort to strengthen the domestic supply chain and reduce reliance on foreign semiconductor producers.
U.S. Secretary of Commerce Gina Raimondo hailed the funding agreement with Samsung, noting that it positions the U.S. as the only country in the world with all five leading-edge semiconductor manufacturers. This is a monumental achievement that will not only enhance national security by securing a steady supply of semiconductors but also create tens of thousands of high-paying jobs and stimulate economic growth across the country.
Controversy Over CHIPS Act Funding
While the CHIPS Act has garnered support from major semiconductor companies, it has also faced criticism. President-elect Donald Trump, set to take office in January 2025, criticized the government’s approach, suggesting that the industry should have been subjected to tariffs rather than receiving grants and loans. His stance casts uncertainty over the future of the CHIPS Act under his administration, and the fate of these agreements may depend on the direction of U.S. policy in the coming years.
What This Means for the Semiconductor Industry and the U.S. Economy
The finalization of CHIPS Act funding agreements with Samsung, Texas Instruments, and Amkor marks a turning point for the U.S. semiconductor industry. The investments promised by these companies, particularly in states like Texas, Utah, and Arizona, will boost domestic manufacturing capabilities, create thousands of jobs, and help meet the ever-growing demand for semiconductors, particularly in critical industries like AI and defense.
These agreements also solidify the U.S.’s position as a global leader in semiconductor production. With significant contributions from major industry players, the future of U.S. chip manufacturing looks promising. However, the success of these initiatives will depend on ongoing government support and industry collaboration.
Frequently Asked Questions
1. What is the CHIPS and Science Act? The CHIPS and Science Act is a U.S. government initiative designed to promote semiconductor manufacturing in the United States by providing financial incentives, including grants and loans, to domestic semiconductor companies. Its goal is to reduce dependence on foreign chip producers and strengthen national security.
2. How will Samsung’s Texas investment impact the semiconductor market? Samsung’s $37 billion investment in Texas will increase the production of advanced semiconductors, helping to meet the growing global demand, particularly in emerging technologies like AI. The project will also create thousands of jobs and contribute to the U.S.’s semiconductor manufacturing capacity.
3. What role does Amkor’s Arizona plant play in the semiconductor industry? Amkor’s new plant in Peoria, Arizona, will focus on semiconductor assembly and testing, a crucial step in the production process. The plant will provide services to companies like TSMC, ensuring the availability of high-quality packaged chips.
4. How will the CHIPS Act impact the U.S. economy? The CHIPS Act is expected to create tens of thousands of high-paying jobs in the semiconductor industry and stimulate economic growth, particularly in states like Texas, Arizona, and Utah. It will also enhance the U.S.’s position as a leader in semiconductor production.
5. Will President-elect Trump’s stance on the CHIPS Act affect these agreements? President-elect Trump has expressed criticism of the CHIPS Act, suggesting that the government should have imposed tariffs on the semiconductor industry instead of offering grants. The future of the CHIPS Act and its funding agreements may depend on policy changes under his administration.
