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Samsung Reportedly Delays Production at New US Factory

Media reports that South Korean company Samsung Electronics Co. has postponed plans to launch mass production at its new chip manufacturing plant in Taylor, Texas.

Samsung Reportedly Delays Production at New US Factory

The information that the launch of the new factory of the mentioned firm will take place later than the initial deadline was published by journalists from South Korea. The postponement of the start of mass production at Samsung’s new American plant is what can be described as a blow to the ambitions of the administration of the current President of the United States Joe Biden, aimed at increasing the volume of domestic supplies of semiconductors.

The process of mass-making chips at the factory in Texas will be launched in 2025. The relevant information was published by the media with reference to the speech of the president of the Samsung foundry unit Choi Siyoung at an industry event in San Francisco. It spent $17 billion on the building of the plant in Texas. The reason for the later start of operating the production site is unknown.

Initially, Samsung announced its intentions to launch production at the American factory in the second half of 2024. The company had such plans in 2021 when it decided to invest in a project to build a plant in Texas.

A Samsung representative in a comment to the media stated that it is not possible to confirm the schedule for the start of mass production at the American factory.

This is not the first time that an Asian company has decided to postpone the launch of a plant in the United States to a later date. For Washington, this delayed implementation of production projects is a very painful circumstance, especially against the background of geopolitical tensions in relations with Beijing, in the context of which China is gradually beginning to focus on achieving the goal of technological sovereignty.

Samsung’s competitor, Taiwan Semiconductor Manufacturing Co., postponed the launch of a new plant in Arizona from 2024 to 2025. The company stated that this decision was made due to a shortage of experienced construction workers and equipment installation specialists.

The US presidential administration is currently seeking to implement a large-scale plan to establish chip production on American territory. This strategy is aimed at protecting the country’s economy and its technology sector from the negative impact of disruptions in the supply chain, which in 2021 provoked a shortage of products that deprived the companies of revenue for several hundred billion dollars. Against the background of these aspirations of the Joe Biden administration, the later launch date of the plants is an extremely negative circumstance that prevents the achievement of a goal of fundamental importance to the economic system of the United States.

The revision of TSMC and Samsung’s plans, as noted by the media, means that the new factories of one of the world’s largest chip manufacturers will be put into operation after the US presidential election. Whether a potentially possible change in the political conjuncture will affect the functioning of the plants cannot yet be confirmed.

In this case, the obvious fact is that the development of domestic production of chips, which are the main components in advanced technologies, including artificial intelligence systems, is a profitable solution for the United States. This industry, in a configuration independent of external suppliers, can ensure technological sovereignty, which guarantees the country a high level of competitiveness in the international arena and good economic prospects.

The American media notes that the problems associated with obtaining environmental permits and the very slow pace of the US presidential administration in providing financial support are barriers to the development of homegrown chip manufacturers.

The Chips Act was signed by Joe Biden last August. This initiative provides for the provision of financial support for $100 billion for the building of new semiconductor plants. Since the signing of the law, the US government has allocated only one grant of $35 million to the American subsidiary of the British aerospace firm BAE Systems Plc.

As we have reported earlier, Samsung and ASML to Invest in Chip Plant in South Korea.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.