The West is increasingly investing in Asia. The main intention behind this is to enable production at the lowest possible cost. Samsung is now making it clear that things can also work the other way around. The South Korean tech company wants to build eleven new factories in the USA. The project is not only expected to cost 200 billion US dollars, but also to create 10,000 new jobs in the US state of Texas.
A gigantic investment
Apparently, Samsung is planning to invest in new sites in the US. This emerges from a report from the news portal Bloomberg. The start in the tech company’s long-running and ambitious plan is a factory in Taylor, a small town in Texas. But according to the reports, this seems to be just the beginning. Ten more factories may follow, which would involve an unprecedented investment volume of 200 billion US dollars.
No other Asian company has ever invested so much in the USA. However, the incentives for the investment do not seem to be high only on Samsung’s side. The settlement is also likely to bring many advantages for the already rather structurally weak region of Texas. The most significant of these is likely to be the creation of 10,000 new jobs.
Samsung hopes for approval
Apparently Samsung is on the verge of putting its money where its mouth is. At the very least, the necessary documents have reportedly already been submitted to the relevant authorities in the US state of Texas. Samsung will not have chosen the Taylor region as the location without reason. The idyllic town is located in the immediate vicinity of Austin, the capital of Texas. In Taylor itself, Samsung wants to build eight more production sites in addition to the new factory currently under construction.
In the course of this, Samsung’s factory site is to become ten times as large as it currently is. Taylor would account for the lion’s share of Samsung’s U.S. offensive, with a total investment of $168 billion. But the South Korean tech company also wants to create new factories in Austin, the nation’s capital. A total of two units would like to be built there combined with an investment of 24.5 billion U.S. dollars.
Mismatch between factory size and jobs
In view of the gigantic investment sums, it is astonishing that Samsung is only creating 8,000 new jobs in Taylor and 1,800 jobs in Austin. After all, we are talking about a total of eleven huge factory buildings. Here it becomes clear what future production will look like for many tech corporations in the consumer electronics sector. For example, many production steps will be increasingly automated by robots. This not only saves money, but also ensures that factories will possibly be able to produce non-stop in the future.
A long-term plan
However, it is likely to be several years before Samsung’s long-term plan is put into action. In terms of the documents submitted, the implementation of the various construction projects spans 20 years. While the construction of the first factory in Taylor is already in full swing, the other ten production facilities are expected to take some time. The first of the additional factories is scheduled for completion in 2034. It is expected to take until at least 2042 for Samsung to complete the last buildings as well.
Samsung reserves US sites
Quite obviously, Samsung sees great opportunities in production in the USA. After all, the company from South Korea emphasizes that it does not want to be pinned down on its plans at the moment. It is possible that Samsung wisely reserves important production sites in the United States. This is especially worthwhile at this point in time. After all, the US is currently promoting the establishment of tech companies in its own country with subsidy programs like the US Chips Act. Samsung, for example, could gain 4.8 billion US dollars from its planned construction project alone.
Unfortunately, what sounds tempting in theory for many companies does not always go off without a hitch in practice. For example, the large chip producer Intel is currently waiting for subsidy payments from the USA. That things can go better is made clear by the example of Taiwan. To combat the semiconductor shortage, Taiwan is currently building production facilities at a cost of $120 billion. Even if Samsung’s plans do not work out, the project underlines the growing importance of Texas as a modern location for large IT companies.