Samsung Postpones Completion of Texas Chip Facility as Buyers Vanish

(MENAFN) Samsung has delivered a crushing blow to US semiconductor ambitions, postponing completion of its massive Texas facility due to a complete absence of buyers for the plant's production, media reported Thursday.

The South Korean technology giant received a staggering $4.7 billion grant from the Biden administration in December under the CHIPS and Science Act, designed to bolster American technological dominance. Samsung pledged to invest over $37 billion in Texas across the coming years.

The Taylor, Texas facility was originally scheduled to launch advanced semiconductor production in 2024, but that timeline has now been pushed back to 2026 amid devastating market conditions.

"The process (of completing the Taylor plant) is delayed because there are no customers. (Samsung) is not in a situation where it can do something, even if it brings equipment in at the moment," a source revealed to media.

A chip supply chain executive familiar with the crisis explained that Samsung, which already operates production in Austin, Texas, faces no urgency to install chipmaking equipment at the new location.

"Local demand for chips isn't particularly strong, and the process nodes Samsung planned several years ago no longer meet with current customer needs," the executive disclosed. "However, overhauling the plant would be a major and costly undertaking, so the company is adopting a wait-and-see approach for now."

Samsung's struggles reflect its inability to compete with industry leader Taiwan Semiconductor Manufacturing Co. (TSMC), which dominates contract chipmaking with a commanding 67.6% global market share by revenue in the first quarter, compared to Samsung's meager 7.7%, according to Trendforce statistics.

Global economic headwinds have intensified Samsung's Texas challenges. While demand for advanced AI processors continues climbing, chip requirements for computers, smartphones, consumer electronics, and automobiles show minimal improvement.

China's push toward domestic chip production amid US tensions has further complicated global semiconductor recovery efforts.

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