Uncertainty clouds Samsung‘s massive chip factory project in Texas as the tech giant faces mounting delays and financial pressures. The company’s ambitious plan to build a 7 million square foot facility by 2028 has hit multiple obstacles, pushing back the original 2024 completion date to 2026.
Samsung now plans to open 6 million square feet by 2026, with another million added by 2028. The delays stem from a global chip glut and market uncertainty that’s forcing the company to rethink its timeline. Construction at the Taylor, Texas site is 99.6% complete, but Samsung hasn’t installed key manufacturing equipment yet.
Samsung scales back Texas chip facility opening to 6 million square feet by 2026 amid global oversupply concerns.
The financial challenges are steep. Each ASML EUV lithography machine costs up to $364 million, and potential tariffs could add tens of millions more per unit. Samsung’s foundry division lost 2 trillion Korean won in 2023, and those losses quadrupled in 2024. The company expects a 3 trillion won shortfall in 2025.
Trump administration policies are adding pressure. The proposed 25% tariffs on non-U.S.-made smartphones are pushing companies to move production to America. Taylor, Texas has reduced subsidies while demanding stricter buildout schedules. The city’s original incentive package offered up to $25 million in rebates but now caps them at $9 million maximum. These protectionist policies are affecting both funding and timelines for the project.
Despite the challenges, Samsung’s pursuing innovative technology goals. The facility will produce state-of-the-art 3nm and 2nm chips for advanced applications, with mass production targeted for late 2025. The company faces staffing obstacles in bringing skilled Korean engineers to Texas. Meanwhile, TSMC’s US setbacks have created potential opportunities for Samsung to capture market share as the Taiwan-based competitor struggles with its own American expansion.
Samsung has slowed its equipment spending and delayed the P4 production line rollout at its South Korea facility. The company’s prioritizing domestic operations while reassessing its global strategy amid financial losses.
However, there’s potential good news. Samsung’s chip team has been negotiating with possible U.S. clients in Texas. Reports suggest emerging deals for advanced chips, with rumors of a Tesla partnership for electric vehicle semiconductors. These specialized automotive chips could support Tesla’s advanced features including Full Self-Driving capabilities that require high-performance processing for real-time decision making. Some estimates point to a theoretical $16.5 billion windfall that could come from automotive or smartphone clients. These partnerships would be vital for the project’s long-term success.