'Attract the 2nd Semiconductor Plant' Fierce US Bidding War... Samsung Watching

Competition to Attract Two Factories in Texas... Recent Meeting Between Samsung and New York State
Arizona Adjusts Land Auction Procedures at Two Sites... US Government Actively Offers Incentives
Samsung "Monitoring Negotiations Before Deciding"... Industry "Investment Timing Will Be a Deep Consideration"

[Asia Economy Reporter Jeong Hyunjin] The competition to attract Samsung Electronics' semiconductor factory in the United States is intensifying. Since Vice Chairman Kim Ki-nam of Samsung Electronics announced a $17 billion (approximately 19.4 trillion KRW) foundry investment in the U.S. last May, the site selection has not been finalized for two months, but there are signs of behind-the-scenes negotiations over incentives emerging in various places. Samsung Electronics has stated that it will not rush to decide where to build its second semiconductor factory in the U.S. and will observe the negotiation process.

According to industry sources and foreign media on the 19th, the Travis County authorities in Texas are scheduled to review the application submitted by Samsung Austin Semiconductor through a virtual meeting on the morning of the 20th (local time). Travis County currently includes the city of Austin, where Samsung Electronics' semiconductor factory is located. Samsung Electronics submitted an application requesting tax benefits to Travis County in January, and no new or publicly disclosed documents have been submitted since March.

Locally, it is expected that no significant action will be taken during this meeting. However, it is anticipated that matters related to property tax will be decided within a few weeks. Travis County officials told local foreign media, "Samsung Austin Semiconductor has submitted an application for an economic development implementation agreement related to 'Project Silicon Silver,' and we look forward to evaluating it and working towards a potential agreement that benefits the Travis County community."

This review comes after news that Samsung Electronics recently submitted an application requesting incentives to Taylor City in Williamson County, another area in Texas. Samsung Electronics submitted documents related to the Taylor Independent School District (ISD) last month. Taylor City is near Austin, where Samsung Electronics' U.S. semiconductor factory is located, about a 30-minute drive from Austin. Locally, it is being assessed that "Travis County and Williamson County are competing over Samsung's manufacturing facilities."

In addition to Texas, Samsung Electronics is reported to have recently met with officials from Genesee County, New York. The local foreign media Buffalo Business First reported, citing sources, that Samsung's site selection team met last week with state and regional economic development officials. It is interpreted that Samsung is negotiating with multiple regions even after submitting an incentive-related application to Williamson County. Genesee County is a region strongly supported by Senator Chuck Schumer, the Senate Majority Leader from the Democratic Party representing New York State. New York State is reportedly considering tax benefits amounting to $900 million to attract Samsung Electronics' semiconductor factory.

In Arizona, another candidate site, the market's attention is focused on the results of ongoing land auctions conducted by the state government. If Samsung Electronics chooses Arizona as the factory site, it is highly likely to purchase land in the Goodyear and Queen Creek areas, which are up for auction. However, the fourth auction, originally scheduled for the 15th, was postponed again. The Arizona state government delayed the auction, setting the next auction date for September 16, as it is highly likely the auction will fail again. During this process, the state government had to undergo a reassessment procedure for the area but decided to extend the period during which the previous evaluation applies. Foreign media interpret this as a measure considering Samsung Electronics.

Samsung Electronics maintains that there is no need to rush to decide on the site amid this competition in the U.S. Although TSMC and Intel have announced plans to build large-scale factories in Arizona, the U.S. government has shown a strong willingness to provide incentives for semiconductor manufacturing facilities, making it important to secure as many incentives as possible. Additionally, Samsung plans to secure a foundry line at the Pyeongtaek 3 plant (P3) under construction in Pyeongtaek and start operations in 2023, so a delay in U.S. foundry investment is not expected to pose a significant problem. Furthermore, it is analyzed that making a decision on a massive investment close to 20 trillion KRW is difficult without the presence of the group's head.

An industry insider said, "While the gap between Samsung Electronics and TSMC is not narrowing easily, Intel is pushing for a merger and acquisition of GlobalFoundries," adding, "Although Samsung Electronics says it will observe the incentive negotiation process, it is deeply concerned that failing to invest on time could cause it to fall behind."

This content was produced with the assistance of AI translation services.