The Biden administration has reached a deal to provide up to $6.4 billion in direct funding to Samsung Electronics to develop a computer chip manufacturing and research cluster in Texas.
The funding announced Monday by the Commerce Department is part of a total investment in the cluster that, with private money, is expected to exceed $40 billion. Government support comes from the CHIPS and Science Act, signed into law by President Joe Biden in 2022 with the goal of reviving the production of advanced computer chips domestically.
“The proposed project will transform Texas into a cutting-edge semiconductor ecosystem,” Commerce Secretary Gina Raimondo said on a call with reporters. “It puts us on track to reach our goal of producing 20% of the world’s most advanced chips in the United States by the end of the decade.”
Raimondo expects the project to create at least 17,000 construction jobs and more than 4,500 manufacturing jobs.
Samsung’s cluster in Taylor, Texas, would include two factories that would produce four- and two-nanometer chips. Additionally, there would be a factory dedicated to research and development, as well as a packaging facility surrounding the chip components.
According to the government, the first factory will begin production in 2026, while the second will begin in 2027.
The financing would also expand an existing Samsung facility in Austin, Texas.
Lael Brainard, director of the White House National Economic Council, said Samsung will be able to produce chips in Austin directly for the Defense Department. Access to advanced technology has become a major national security concern in the context of competition between the United States and China.
In addition to the $6.4 billion, Samsung has indicated it will also apply for an investment tax credit from the US Treasury Department.
The government has previously announced terms to support other chipmakers, including Intel and Taiwan Semiconductor Manufacturing Co., in projects across the country.