A semiconductor factory being built by Samsung Electronics in Taylor, Texas, USA. (Image courtesy of Samsung Electronics)
SEOUL, Sept. 12 (Korea Bizwire) – Samsung Electronics’ ambitious push into advanced chip manufacturing in the United States has encountered a significant setback, with the company recalling a majority of its Korean employees from its Taylor, Texas foundry project.
This move signals a pause in the semiconductor giant’s drive to challenge Taiwan’s TSMC in the cutting-edge chip production arena.
Industry sources revealed on September 11 that over half of the staff dispatched to the Taylor facility construction site in 2022 and 2023 returned to South Korea in late August and early September.
The recall affects dozens of employees involved in construction, infrastructure, and manufacturing technology.
The Taylor plant, slated to produce chips using 4-nanometer and 2-nanometer processes, has struggled with low yields for its 2-nanometer technology.
This technological hurdle, coupled with difficulties in securing orders from major tech companies, has forced Samsung to take a step back in its expansion plans.
Samsung’s foundry division had hoped to fill the Taylor plant’s capacity with contracts from big tech firms like AMD and Nvidia.
However, these efforts have not materialized as expected. The company now plans to operate the facility with minimal staff until year-end, when it hopes to have a clearer picture of potential contracts.
The uncertainty surrounding the Taylor project has also led to a phased withdrawal of partner companies that had relocated to assist with equipment setup.
Samsung Electronics already operates a foundry in Austin, Texas, USA. (Image courtesy of Samsung Electronics)
An anonymous Samsung official stated, “For about two years, the staff dispatched from Korea to Taylor were just running simulations without any substantial equipment setup. It’s natural for them to return to Korea.”
The Taylor foundry, which had its groundbreaking in 2022, is a crucial component of Samsung’s “System Semiconductor Vision 2030.”
This initiative, announced by Chairman Lee Jae-yong in 2019, aims to secure Samsung’s position as the undisputed leader in system semiconductors, including foundry services, by 2030.
The project represents Samsung’s largest U.S. investment since completing its first American foundry in Austin, Texas, in 1998. The company plans to invest $45 billion in U.S. semiconductor operations by 2030.
Despite Samsung’s efforts to compete with TSMC using 2-nanometer technology at the Taylor plant, major tech clients including AMD, Nvidia, Qualcomm, and Apple have predominantly chosen TSMC for their chip production needs.
The challenges extend beyond the Taylor facility. Samsung’s P4 fab at its Pyeongtaek campus, initially designed as a mixed-use facility for DRAM, NAND, and foundry lines, has recently shifted all four of its lines to memory chip production due to insufficient foundry orders.
Another Samsung insider commented on the predicament: “We’re committed to the Taylor plant and expect to receive subsidies under the CHIPS Act. However, our foundry order volume is so low that even using just our Korean facilities would leave excess capacity.”
Kevin Lee (kevinlee@koreabizwire.com)
