Expectations grow for Samsung’s expansion in US

Samsung Electronics may be considering ramping up its Austin, Texas-based semiconductor factory as part of efforts to strengthen its foothold in the foundry market, according to industry sources on Wednesday.

Expectations are growing as Samsung seeks a zoning change for plots of land near its Austin campus it purchased in late October.

Samsung Austin Semiconductor has filed a request with the Austin City Council for a rezoning of some 205 acres of the 258-acre land, which is about 104,089 square meters.

The council is slated to convene on Thursday, US time, to discuss the matter. The Austin Business Journal reported earlier that the Austin Zoning and Platting Commission has approved staff recommendations to rezone the area.

Established in 1996, Samsung’s Austin chip plant produces memory and system-on-chips for mobile phones, tablets and other electronics devices, and also provides foundry services for chipmakers based in the US.

Samsung started operating the first fabrication line for DRAM memory there in 1997 and the second line for NAND Flash memory in 2007.

In 2017, the company undertook some expansion works to secure additional space for office, production and amenity needs at the campus.

It has invested more than $17 billion over the last 24 years, and currently has over 3,000 employees.

“The land purchase would give the company more flexibility in operating the production facility, but there is no imminent plan,” said an official at Samsung’s Seoul-based headquarters.

Some speculate that Samsung could move to increase its foundry production in the US in a bid to keep its rival TSMC in check.

The Taiwanese foundry company that is leading Samsung by a large margin in the foundry market has announced its $12 billion investment in Arizona to build a cutting-edge 5-nanometer plant to get closer to its major customers like Apple and AMD.

Samsung’s latest foundry plant in Austin produces products using 14-nanometer technology, which would be outdated when TSMC completes the 5-nm plant.

Other watchers linked the land deal to Samsung’s strategy to follow US President-elect Joe Biden’s “Buy America” campaign that aims to revitalize the country’s manufacturing industry by persuading the people to buy made-in America products.

“The expansion rumors are mounting as Samsung’s Austin plant has been increasing its hiring in recent months, offering over 400 jobs there,” an industry insider said.

By Song Su-hyun (song@heraldcorp.com)