Update: Tesla, Apple, Google and Samsung in Austin

[TruckElectric]

Tesla picks Austin, Texas for $1 billion auto factory

In one of the largest economic development projects in Austin's history, electric automaker Tesla says it will build a $1.1 billion assembly plant in Travis County that will employ 5,000 people.



Bloomberg wrote in 2018 that Texas would not be the site of Apple's fourth campus. Obviously Apple changed their mind.

Headquarters
Apple has two major campuses in Cupertino: its original Infinite Loop campus and now the Apple Park, plus a major presence in Austin, Texas.

Source: BLOOMBERG

Apple Campus

Apple has broken ground on its new 133-acre campus in Austin, which will initially house 5,000 employees.


Apple in Austin
Apple has broken ground on its new $1 billion, 3-million-square-foot campus. The campus will initially house 5,000 employees, with the capacity to grow to 15,000, and is expected to open in 2022.


Making Mac Pro in the US

The all-new Mac Pro is Apple’s most powerful machine ever, and 15,000 times faster than the original Mac. Apple and its manufacturing partners invested over $200 million in the Mac Pro facility in Austin, building out the complex assembly line where the Mac Pro is produced. Each Mac Pro travels a distance of 1,000 feet along the production line, with some components requiring precision placement within the width of a human hair.

Mac Pro is designed and engineered in California, and assembled in Austin, Texas, in a facility that employs more than 500 people.

Source: APPLE







Samsung Austin Semiconductor

August 2017
Expansion to provide additional space for office, production and amenity needs

Proud to be "Made in Austin"

Samsung Austin Semiconductor is celebrating more than 20 years in Central Texas. Our site was mirrored after the Hwaseong semiconductor site in Korea. From a cornfield to one of the world’s best foundries, we have invested more than $17 billion and created $4 billion in economic activity for the greater Central Texas region. We’re proud that our employees and partners think of Samsung Austin Semiconductors as part of the fabric of this community. We know that our growth – and continued growth – could only happen with their support and enthusiasm. Below is a timeline of our impact in Central Texas and the semiconductor industry. We will continue to open new horizons in this digital era – where semiconductor chips smaller than a fingernail inspire the world to live better and learn better.

Source: SAMSUNG AUSTIN SEMICONDUTOR

By Will Anderson – Managing Editor, Austin Business Journal
Nov 1, 2019, 7:46pm CDT Updated Nov 7, 2019, 10:32am CST
Samsung, a major recipient of public incentives in Austin, is cutting 290 jobs as it closes a research and development hub.



Google has been expanding in Austin since opening offices in 2007. Austin was a contender for Google's first "Fiber City" but lost out to Kansas City. It was important that Austin get the high-speed internet service as Austin considered itself as a tech center hoping to rival Silicon Valley. So Austin lobbied hard to get Google to come to their city next and they did about 2 years later. An article in the Austin American-Statesman tells about it's impact - link: High Impact


Google downtown Austin 500 West 2nd

Link to pics inside Google Austin downtown tower



7 story Saltillo tower Austin

Google will lease entire new Saltillo tower Michael Hsu Office of Architecture

Google will lease the planned 35 story office tower in 2023

Rendering of planned downtown tower to be occupied by Google Pelli Clarke Pelli Architects / STG Design (Steelblue)

The tower will have 793,883 square feet of office space—enough for about 5,000 people—and will include standard tech-company perks: a fitness center and recreation areas, lounges, kitchen and dining areas, conference centers, a bar/tavern, and, surely, more. Its 1,327 parking spaces will be on lower floors, with some of it underground.

Oracle campus Austin

Tesla had plans all along to build it's new factory in Austin. They had to have been studying the area for awhile and had plans for the construction long before the announcement.

If Tesla doesn't move their HQ to Austin I'll be shocked.

There have been comparisons of Tesla to Apple(and Tesla cars to the iPhone).

Although Tesla is technically an auto manufacturer it can be argued they are a tech company as well.

So it was fitting(and destined) that Tesla located in Austin.




Tesla will be the big dog in Austin in say 5 yrs

 

[TruckElectric]

Videos of Apple campus

May 4, 2020






July 26, 2020

 

[TruckElectric]

Videos of Apple campus

May 4, 2020






July 26, 2020

Apple said there will be a nature preserve on their new site and it would be open to the public.

Hmmm, is Tesla following Apple?

 

[TruckElectric]

This would be another mega-factory for Austin — 10 times more expensive than what Tesla is touting.

Report: Samsung could be planning $10B chipmaking plant in Austin
Company recently purchased a swath of land next to its current Austin campus

Enlarge
Samsung's Austin computer chip plant is at 12100 Samsung Blvd., off Parmer Lane and about 3 miles east of I-35.
COURTESY PHOTO

By Kathryn Hardison – Staff Writer, Austin Business Journal
Jan 22, 2021, 3:42pm EST

Samsung Electronics Co. could be planning to build a $10 billion chipmaking plant in Central Texas, according to a Bloomberg report.

That $10 billion reported price tag is almost 10 times as high as the $1.1 billion investment Tesla Inc. promoted for its Austin factory under construction.
Sources familiar with the matter told Bloomberg that the world's largest memory chip and smartphone maker is planning a U.S. facility that may be located in Austin. This is one more indication Samsung could be growing in a big way in Central Texas, as Austin Business Journal has previously reported.

Samsung Austin Semiconductor LLC purchased roughly 258 acres in late October around its massive campus off East Parmer Lane and garnered Austin City Council approval to rezone the property in December. Documents previously filed with the city indicated the land could one day be used for expansion, though there were no imminent plans.

This map shows the land recently purchased by the company.

https://www.google.com/maps/d/viewer?mid=1i_5MVTRre1Tadq_UBymogEs_gper1PEt&ll=30.369873599046713,-97.61230075805227&z=13



Michele Glaze, director of communications and community affairs for the company, previously told ABJ that the rezoning requests were part of the company's strategic planning "to remain flexible in making business decisions."

Glaze maintained that response in a Jan. 21 statement to ABJ in regard to another planning move made by the company. Samsung Austin Semiconductor is seeking to vacate two tracts of right-of-way on the property to realign and rebuild Samsung Boulevard — the road that runs through the campus. Council will consider the request at its Jan. 27 meeting.

Glaze said the newly constructed Samsung Boulevard will be wider and include protected sidewalks and bike lanes. If approved by Council, construction could start in 2021 and continue through 2023, Glaze said in a statement.


Bloomberg reported that the company is planning to start construction on the multibillion plant with the same timeline — starting this year and beginning operations as early as 2023.



Enlarge
Samsung's North Austin campus off Parmer Lane.
FILE PHOTO

The company wants to invest in nanotechnology at the future U.S. plant. Bloomberg reported that this investment could win the company more American clients and compete with industry leader Taiwan Semiconductor Manufacturing Co.

Glaze could not be immediately reached for additional comment following the publication of the Bloomberg report on Jan. 22. Samsung said in an email to Bloomberg that no decision has been made yet.

Samsung established an Austin presence in 1996 and opened its first fabrication plant in 1997. It has expanded its campus over the years and now has roughly 2.45 million square feet on 300 acres, where about 3,000 people work. The local arm of the Korean technology giant has helped make Central Texas a hub for semiconductor production, along with other big companies such as NXP and Applied Materials.

Samsung ranked last year as Austin's 12th-largest employer.
It has a history of working with state and local governments and the Manor Independent School District on incentives deals that result in tax savings. Samsung Austin Semiconductor LLC, for instance, has received at least $65 million in tax rebates from Travis County alone since 2009 in exchange for growing its massive corporate campus on the north side.

SOURCE: Houston Business Journal

 

[TruckElectric]

Tesla has reportedly partnered with Samsung on a new 5nm chip for full self-driving, according to a new report coming from Korea.


Tesla moves to design its own chips
Back in 2016, Tesla started building a team of chip architects led by legendary chip designer Jim Keller to develop its own silicon.

The goal was to design a super powerful and efficient chip for self-driving.

In 2019, Tesla finally unveiled the chip as part of its Hardware 3.0 (HW 3.0) self-driving computer.

They claim a factor of 21 improvement in frame per second processing versus the previous generation Tesla Autopilot hardware, which was powered by Nvidia hardware, while only barely increasing the power consumption.

When launching the new chip, CEO Elon Musk announced that Tesla is already working on the next generation of the chip, and they expect it to be three times better than the new chip and roughly two years from production.

Tesla’s next-generation self-driving chip
A few months ago, there was a report that Tesla planned for its next-generation self-driving chip to use a 7-nanometer process by TSMC, a Taiwan semiconductor company.

Now a new report from Korea states that Tesla is partnering with Samsung on a 5-nanometer chip for self-driving (via Asia-E and translated from Korean):

According to related industries on the 25th, the Samsung Electronics Foundry Division is currently conducting research and development (R&D) on 5nm-class system semiconductors to be mounted on Tesla autonomous vehicles. The 5nm semiconductor applied with the extreme ultraviolet (EUV) process is a high-tech product that only a small number of companies such as Samsung Electronics and TSMC can produce worldwide.

Samsung is already Tesla’s partner for the production of its current self-driving chips in its hardware 3.0 computer.

However, that chip is based on a 14-nm technology.

5-nm chips are a more recent technology that only started to make it into commercial products last year. They are found in some of the latest smartphones, like Apple’s iPhone 12.

The latest report on Tesla’s new chips stated that mass production was planned for Q4 2021 – meaning that we aren’t likely to see those chips inside Tesla production vehicles until 2022.

SOURCE: ELECTREK

 

[TruckElectric]

Tesla Supplier Samsung Considers $17 Billion Plant for 'advanced logic devices' Production in Austin
by Eva Fox February 06, 2021

Samsung Tesla

Samsung Electronics is considering Austin, Texas as one of the sites for a new $17 billion chip factory that could create 1,800 jobs. This location, among other factors, may be attractive due to the fact that Tesla's factory is located there. The company is an important customer of Samsung, as it buys chips for its cars.

Samsung intends to build a 7-million-square-foot, next-generation chip fabrication plant, which could be the next step in a new partnership with Tesla, according to filings with the Local Government Assistance & Economic Analysis Division in Austin on January 11. In late January, industry sources revealed that Tesla and Samsung would be collaborating to develop a new 5nm chip that will be the most advanced in the world. Samsung is currently supplying 14nm chips to Tesla.

The South Korean tech giant is seeking a combined $805.5 million in tax breaks over 20 years from Travis County and the City of Austin, as well as other tax breaks. In its filings, Samsung said that if Austin is selected, the company will begin construction in Q2 2021, and the plant will start operating in Q3 2023. The document refers to a site in the Manor school district, Travis County.

"Based on various factors, we are reviewing the possibility of expanding our semiconductor manufacturing facilities. A number of global locations, including multiple candidates within the US, are under consideration. However, no decision has been made at this time," the company said.

Austin is already home to Samsung's largest facility outside its South Korea headquarters. In October 2020, the company bought seven tracts of land totaling 257.5 acres near its existing Northeast Austin facility. In December, the company also requested a zoning change to allow for more industrial uses on three tracts. But in the document, Samsung said that it is also considering incentive offers from New York, Arizona, and another Texas-based site, according to state filings.

Samsung said in the filing that it plans to produce “advanced logic devices,” which could indicate that it is a new 5nm chip that is being co-developed with Tesla. This proximity of Samsung's new chip production plant to Tesla's Giga Texas could be a good deal between the companies.

ABOUT THE AUTHOR

EVA FOX
I'm a big fan of Tesla, as I worry about the future for my child and for future generations. Tesla's mission is to accelerate the world's transition to sustainable energy and I'm passionately striving for this goal. I’m tired of the daily deception from Tesla’s haters against the company, so I strive to spread true information and the latest news about Tesla

SOURCE: TESMAIAN



Samsung wants $1 billion tax incentive for new Austin plant that would create 1,800 jobs
Kara CarlsonBob Sechler
Austin American-Statesman

Samsung is seeking a taxpayer-subsidized incentives package worth more than $1 billion to choose Austin for its next big facility – a 7-million-square-foot next-generation chip fabrication plant that would be valued at more than $17 billion and create 1,800 jobs, according to documents filed with the state.

The documents made public by the Texas comptroller's office Thursday show that Samsung is seeking tax abatements from Travis County, the city of Austin and the Manor school district. Samsung is also seeking an incentive deal from the state's Texas Enterprise Fund, according to the documents.

The company wants a 100% tax abatement over 20 years from Travis County, which would be worth $718.3 million. Travis County spokesman Hector Nieto said the county has not received a formal application from Samsung. He declined to comment further.

The tech giant also is seeking 50% tax abatements from the city of Austin that would be worth $87.2 million over five years, according to the documents.

The company said in a statement that Austin is one of a number of locations under consideration and no decision has been made.

"Based on various factors, we are reviewing the possibility of expanding our semiconductor manufacturing facilities. A number of global locations, including multiple candidates within the U.S., are under consideration. However, no decision has been made at this time," the company said.

In addition, Samsung is seeking a Chapter 313 incentive agreement with the Manor school district. That refers to Chapter 313 of the Texas Tax Code, which allows school districts to grant property tax breaks for economic development projects. The state is then required to repay the school district for the amount of property tax it gives up in the agreement. The proposed agreement calls for saving Samsung $252.9 million in taxes to the school district.

Samsung projects that the proposed new facility would have an initial average annual wage of $66,254 for its employees. The facility could have a local economic impact of $8.6 billion over its first 20 years of operation, according to the documents filed with the state.

Angelos Angelou, CEO of Austin-based Angelou Economics, said the planned chip plant would be a huge boon to the region. But he also said the requested tax breaks –particularly the 100% abatement from Travis County – are likely opening salvos in planned negotiations.

"I don't think there is a precedent for a 100% tax abatement anywhere in the country," Angelou said. "I do think if they came down to maybe 15 years, or maybe 20, at 70% to 80% (abatement), there could be a deal had.”

Austin is already home to Samsung’s largest operation outside of its South Korea headquarters. Landing the new facility would add to a recent string of stunning economic development wins for Austin, which in the past six months has seen Tesla start work on a $1 billion assembly facility locally and tech giant Oracle formally move its corporate headquarters to Central Texas.

The Manor school district previously approved two Chapter 313 agreements with Samsung for its existing facility here. Those agreements – one created in 2005 and the other 2012 – are ongoing and are providing the tech giant with an estimated $200 million in tax breaks over a 17-year period that ends in 2023

If Samsung chooses Austin for the new chip plant, work would start on it as early as the second quarter of this year, with a planned completion date by the end of 2023, according to the documents filed with the state.

Amber Gunst, CEO of the Austin Technology Council, said Samsung considering Austin for this significant expansion is a good thing for the region's economy.

“As there are other highly competitive markets seeking to win this expansion deal, it is imperative that our state and local governments work together to ensure Austin comes out on top," Gunst said. "Not only does this provide 1,800 jobs that will be available to Central Texans of all education and skill levels, this expansion creates an even stronger relationship between Samsung and Austin, a relationship we value immensely.”

Samsung is also considering incentives offers from New York, Arizona and another site in Texas, according to the documents filed with the state.

"This project is highly competitive, and the company is looking at alternative sites in the U.S. including Arizona and New York, as well as abroad in Korea where Samsung Austin Semiconductor’s parent company is headquartered. ... Because of its strong ties to the local community and the successful past 25 years of manufacturing in Texas, Samsung Austin Semiconductor would like to continue to invest in the city and the state," Samsung said in its application.

"Due to the higher tax cost of operating in Texas, the appraised value limitation is a determining factor. Without the appraised value limitation award, the company would likely locate the project in Arizona, New York or Korea," the company said.

Patrick Moorhead, an Austin-based analyst with Moor Insights and Strategy, said Central Texas will no doubt face fierce competition to land Samsung's expansion.

“Austin will have to compete for any future leading-edge semiconductor facility. Cities from around the world want access to this, as it brings so many high-paying jobs to the area,” Moorhead said.

South Korea-based Samsung is one of the world's largest memory chip and smartphone makers. The company is planning to build an advanced logic chipmaking plant that would be a significant step forward for the company's overall chipmaking capabilities. The facility would improve Samsung's ability to compete with other chipmakers, and it could help Samsung become the chipmaker of choice for companies including Apple and Advanced Micro Devices.

Daniel Ives, an analyst with Wedbush Securities, said Samsung is trying to diversify its manufacturing locations, including in the U.S., and it has made significant technology strides at the Austin facility in the past, which may be why the company might want to double down on the location.

Ives said Austin is also on its way to becoming the hottest destination for technology companies to build out.

“Samsung has found the trend of Tesla, Oracle and others that are viewing Austin because of the engineering talent, because of its location, where there’s significant room to build out factories,” Ives said “As it becomes more of a tech hub, no different than what we've seen in Tel Aviv and Silicon Valley, it becomes a flywheel effect.”

Industry analyst Roger Kay, with Endpoint Technology Associates, said that while Samsung is exploring different locations, Austin has a lot to offer.

“Samsung already has a large presence there, and Austin is a good location for tech companies. It has an educated workforce experienced in technology. Texas has lenient corporate laws and an attractive tax regime. And the weather is great eight months a year,” Kay said.

Ives said the recent economic development for the Austin region is the “tip of the iceberg” for potential technology growth for the region.

“In 20-plus years covering tech, there have been many cities over the years that have had false starts that were going to be the next mini-Silicon Valley, from Atlanta to Boston to Montana, and didn't really come to fruition to meet those expectations. ... Austin, I think, is the real deal. Austin is becoming a key destination because of engineering talent, the cost of living relative to California as well as New York City, and it has potential to attract more and more tech companies over the coming years.”

While Samsung has said that no decision has been made on a site for its new facility, it has already taken some steps in recent months that could indicate it is preparing for an Austin expansion.

In October, the company bought seven tracks of land totaling 257.5 acres near its existing Northeast Austin facility. In December, the company also requested a zoning change to allow for more industrial uses on three tracts.


The Austin City Council recently approved a plan to relocate most of the existing Samsung Boulevard, which runs alongside Samsung's current Austin facility. Documents filed with the city call for removing a section of Samsung Boulevard from East Parmer Lane just before it runs into the Pioneer Crossing subdivision. In its place, a new spur of Braker Lane would be built to route traffic from the subdivision onto the new Samsung Boulevard.

Samsung has had operations in Austin since 1997. It has a fabrication plant in Austin, where it has previously said about 10,000 people work, of which about 3,000 are Samsung employees and the rest are contractors. Samsung also has a research and development facility project in Austin. The company has said it has invested about $17 billion in its Austin campus through the years.


SOURCE: Austin American-Statesman

 

[rr6013]

Wow… been asleep. Missed Austin TX is going Cyber City.

 

[Crissa]

Wow… been asleep. Missed Austin TX is going Cyber City.

They've been that way for a long time. The last five decades, at least.

-Crissa

 

[TruckElectric]

Technology
Samsung Details Plans for $17 Billion Chip Facility in U.S.
By
Sohee Kim
March 3, 2021, 2:23 AM CST Updated on March 3, 2021, 2:46 AM CST

Samsung Electronics Co. revealed additional details about its plans to build a cutting-edge semiconductor facility in the U.S. in a filing with the Texas government, making the disclosure as the Biden administration vows to make the security of the U.S. chip supply a national priority.

The South Korean company plans to invest about $17 billion in its Project Silicon Silver and create about 1,800 jobs over the first ten years, according to an economic impact study prepared by a local consultant. Some $5.1 billion would go into buildings and property improvements, while $9.9 billion would be spent on machinery and equipment.

The filing with the Texas comptroller warned the chips project is “highly competitive.” Samsung is evaluating alternatives sites in Arizona and New York, as well as in Korea.

“Because of its strong ties to the local community and the successful past 25 years of manufacturing in Texas, Samsung Austin Semiconductor would like to continue to invest in the city and the state,” the study said.

In their first weeks in office, Joe Biden’s administration has emphasized the importance of advanced technologies, including semiconductors, artificial intelligence and next-generation networks. The president has ordered a global supply chain review for microchips as well as large-capacity batteries, pharmaceuticals and critical minerals and strategic materials such as rare earths.

Bloomberg News first reported in January that Samsung was considering building an advanced chipmaking plant in the U.S., in hopes of winning more American clients and narrowing the gap with industry leader Taiwan Semiconductor Manufacturing Co. The company was in discussions to locate a facility in Austin, Texas, capable of fabricating chips as advanced as 3 nanometers, people familiar with the matter said at the time.

Details of Samsung’s discussions with local governments have since leaked out in filings and other revelations. The economic impact study was prepared by Impact DataSource LLC, an Austin, Texas-based economic consulting, research and analysis firm.

The report shows Samsung’s Project Silicon Silver would add approximately 7 million square feet of new space to the Austin campus, where the company has had operations for decades. It estimates that 542 new workers would move to the city, contributing to an addition of 1,626 new residents.

Property tax abatements would total about $1.5 billion over 20 years at the city and county levels, while direct and indirect economic output would be about $8.6 billion and salaries would total $7.3 billion.

A January filing detailed the likely timeline for the project. If Samsung chooses Austin, it would break ground in the second quarter of 2021 with the expectation that production would be up and running by the fourth quarter of 2023, it said.

Separately, Samsung’s current foundry plant in Austin hasn’t resumed operations since Feb. 16 after it was ordered to halt operations by Austin Energy due to blackouts in the region. Power and water are back but it will take more time to fully restart operations, officials said.

SOURCE: BLOOMBERG

 

[FutureBoy]

Wow… been asleep. Missed Austin TX is going Cyber City.

They've been that way for a long time. The last five decades, at least.

So is @rr6013 a pseudonym for Rip Van Winkle?

 

[rr6013]

Pretty acc

So is @rr6013 a pseudonym for Rip Van Winkle?

Accurate! Took my eye off TX and Austin music scene even when GOOG went there. It was a corner of the universe, music venue and SXSW destination. As a Californian a Texan swindled on a contract and another pledged California was nothing but “ Flash, cash and trash”. I never looked back.

 

[TruckElectric]

Samsung and TSMC set for world domination

Without extremely quick and decisive action by other IC producers or governments, Samsung and TSMC are well on their way to world domination of leading edge IC process technology – the cornerstone of all of the advanced consumer, business, and military electronic systems of the future, says IC Insights.

Can governments like the EU, U.S., and China invest in their indigenous IC industries and catch up in the IC technology race with Samsung and TSMC?

Considering how far behind they are, IC Insights believes that governments would need to spend at least $30 billion per year for a minimum of five years to have any reasonable chance of success. Is there the willingness and/or ability to follow through on such a commitment?

Moreover, for China, even if the money were available, they would certainly be hindered by trade issues prohibiting some of the most critical pieces of process equipment from being sold into the country.

It now appears that both Samsung and TSMC realize the golden opportunity that is currently before them.

While Samsung began its spending surge in 2017, TSMC will begin what is likely to be a huge multi-year ramp of spending in 2021.

Combined, IC Insights expects Samsung and TSMC’s capital expenditures will reach at least $55.5 billion this year and represent an all-time high percentage of total semiconductor industry outlays held by the top two spenders.

With no other companies presently able to match these huge spending sums, Samsung and TSMC will likely put even more distance between themselves and their competition this year with regard to advanced IC manufacturing technology.

Keeping up with producing leading-edge IC technology has become increasingly expensive over the past 25 years. The investment required to implement the most advanced process technologies for logic devices has now driven out all but three companies—Samsung, TSMC, and Intel, from the leading edge portion of the market.

Moreover, of these three manufacturers, only two can truly be considered to be at the leading edge (Samsung and TSMC), with both in volume production of 7nm and 5nm ICs.

In contrast, Intel is not expected to be in high volume production of 7nm devices, in its own fabrication facilities, until 2022, at which time Samsung and TSMC are forecast to be producing commercial quantities of ICs using 3nm process technologies.

Historically, the IC companies that had the highest level of capital expenditures were also the companies that were able to produce the most advanced devices.

Although Intel has been among the top two leading semiconductor industry capital spenders for 25 out of the past 27 years (Figure 1), the company spent only about half of what Samsung spent in 2020 and is expected to once again fall far short of what both Samsung and TSMC are expected to spend this year (about $28 billion each).

Figure 1

TSMC is the only pure-play foundry to offer leading-edge technology. It is seeing very strong demand for its 7nm and 5nm processes, which represented 47% of the company’s sales in 2H20. Most of its current investment is targeting additional capacity for its 7nm and 5nm technologies.

Illustrating how quickly TSMC moved to more advanced processes, the company’s 5nm products represented 8% of its total 2020 sales ($3.5 billion), after essentially having no 5nm revenue in the first half of last year.

On January 14, 2021, TSMC dropped its “bombshell” news that it plans to ramp up its capital spending this year to $25-$28 billion, a 60% increase using IC Insights’ expectation for $27.5 billion in outlays by the company. At $27.5 billion, the company’s average quarterly capital spending rate this year would be $6.9 billion, more than double what the company spent in 4Q20.

Samsung first spent more than $10.0 billion in semiconductor capex in 2010. After spending $11.3 billion in semiconductor capex in 2016, Samsung’s 2017 outlays for the semiconductor group more than doubled to $24.2 billion.

Samsung’s semiconductor capital spending has remained very strong since 2017 with outlays reaching $21.6 billion in 2018, $19.3 billion in 2019, and a massive $28.1 billion last year.

The sheer magnitude of Samsung’s spending over the 2017-2020 timeperiod ($93.2 billion) is unprecedented in the history of the semiconductor industry! At $93.2 billion, this amount was more than double the $44.7 billion spent by all the indigenous China semiconductor suppliers combined over this same timeframe.

Although Samsung has not provided guidance for its 2021 outlays, IC Insights estimates that the company will keep its spending essentially flat with 2020.

SOURCE: ElectronicsWeekly



U.S., Others Need To Spend At Least $150 Billion To Catch Up To TSMC, Samsung Believes Research Firm

By Ramish Zafar

Semiconductor fabrication at Intel; Intel Corporation

Chipmakers Taiwan Semiconductor Manufacturing Company (TSMC) and Samsung Electronics are on their way to allocte historical levels of capital expenditure in their processes. TSMC, which is aggressively ramping up production of chips on the leading-edge 5nm process node and Samsung, which is currently the company's biggest rival in the contract manufacturing space will spend a combined $55 billion on facilities and equipment to print semiconductors reveals a new report by Arizona-based research firm IC Insights.

To keep up with the chip behemoths, national governments such as those in the U.S., EU and China need to spend $150 billion spread out over the next five years if they have any hope of developing an indigenous industry capable of matching the Asian giants' manufacturing prowess.

Samsung Projected To Spend $28 Billion In Chip Manufacturing Capital Expenditure This Year
Currently, the leading spender in the chip manufacturing space is the South Korean chaebol Samsung Electronics. The group manufactures semiconductors on high-end processing nodes through its foundry arm Samsung Foundry. Samsung spent $28.1 billion in foundry capital expenditure last year, and the company will maintain this spending level in 2021 believes IC Insight.

Following TSMC's revelation earlier this year that it will spend in between $25 billion - $28 billion in capital expenditure, total spending by the top two players in the contract chip manufacturing space is expected to reach at least $53 billion - a figure slightly lower than IC's estimate of $55 billion which assumes a $27 billion capital expenditure by TSMC.

For comparison, Intel Corporation spent $14.3 billion in 2020 - a figure that is not directly comparable to Samsung's since it does not include expenditure for NAND memory manufacturing.


Intel also noted in its Form 10-K filed with the Securities and Exchange Commission that:

In 2020, we encountered a defect mode in the development of our 7nm process technology that resulted in yield degradation, which was the primary driver for a delay in our expectations for our 7nm-based CPU product timing. These delays can allow competitors to benefit from advancements in manufacturing processes introduced ahead of us by third-party foundries and could adversely affect the competitiveness of our products.

IC Insight's visual representation of the share of capital expenditure by the two largest players in the chip manufacturing space as a percentage of total expenditure. From 1994 to 2009 Intel was the biggest spender, except for the five years between 2004 - 2008 when it was replaced by Samsung. Since 2009, Samsung has consistently led others in spending, with TSMC and Intel replacing each other for the second spot. Image: IC Insights

Given that in the chip manufacturing arena research and development is king owing to the fact that it takes several years before research breakthroughs can be translated into manufacturable products, IC Insights speculates on what actions governments of the U.S., EU and China can take to mirror developments by TSMC and Samsung.

According to the firm, the $150 billion figure quoted above is the bare minimum for governments if they want to stay competitive in the chip manufacturing space. At his front, the U.S., as part of the National Defense Authorization Act (NDAA) for 2021 has allocated up to $3 billion for individual projects aimed at increasing American chip manufacturing capacity.

Interestingly, a CHIPS for America Act (H. R. 7178) currently referred to the Committees of the House envisages precisely the magical $30 billion/year spending figure that IC Insights believes is crucial for developing the industry. This Act allocates $10 billion each for manufacturing chips on or below the 3-nanometer node, for supply chain security and for the creation of an institute focused on manufacturing and research. Spending for each of the sectors is for five years, for a total of $150 billion.

Finally, IC Insights also doubts China's ability to catch up to either TSMC or Samsung even if it does spend the $150 billion. This is due to export control regulations limiting the country's ability to procure key manufacturing equipment.

SOURCE: Wccftech