Samsung receives federal funding totaling $6.4 billion to produce computer chips in Texas.

An agreement has been reached by the Biden administration to give Samsung Electronics up to $6.4 billion in direct assistance to establish a computer chip manufacturing and research center in central Texas.

In 2021, Samsung first declared that it would construct a facility in Taylor, Texas. The business announced at the time that it was investing $17 billion. An extension of an existing plant in Austin is now part of the project. The Commerce Department’s funding announcement on Monday brings the overall investment to above $40 billion.

The CHIPS and Science Act, which President Biden signed into law in 2022 with the declared intention of restoring the home production of cutting-edge computer chips, provides the government with support.

During a call with reporters, Commerce Secretary Gina Raimondo stated, “The proposed project will propel Texas into a state-of-the-art semiconductor ecosystem.” “It puts us on track to hit our goal of producing 20% of the world’s leading-edge chips in the United States by the end of the decade.”

According to Raimondo, the project is expected to generate around 4,500 manufacturing employment in addition to at least 17,000 construction jobs.

A similar measure, the CHIPS for America Act, established federal programs to promote semiconductor production and was written by Texas senator John Cornyn (R).

“We are strengthening our national security and global competitiveness, helping to secure this vulnerable supply chain, and creating new jobs for Texans by investing in cutting-edge semiconductor manufacturing,” Cornyn stated in a statement made public on Monday morning.

Samsung planned to establish two facilities in Taylor, which is northeast of Austin, to produce semiconductors with a nanometer and four nanometer size. There would also be a facility for the packaging that encloses chip components and a factory devoted to research and development.

The government anticipates that the first factory will open for business in 2026 and the second in 2027.

Samsung will be able to produce chips for the Defense Department directly in Austin as a result, according to Lael Brainard, director of the White House National Economic Council. Amidst competition between the United States and China, access to cutting-edge technology has emerged as a significant national security concern.

Samsung has stated that it will apply for an investment tax credit from the US Treasury Department in addition to the $6.4 billion.

In the past, the government has made plans to fund projects across the nation for other semiconductor manufacturers, such as Intel and Taiwan Semiconductor Manufacturing Co.