Samsung to invest $3.6 billion in Austin plant

Samsung Electronics, AsiaÔÇÖs biggest maker of semiconductors, has announced it is to make a $3.6 billion investment in expanding capacity at its 12-inch chip plant in Austin, Texas.  The new facilities will be used to make large scale integration (LSI) chips. The company also plans to add 500 jobs at the plant, which is run by the Samsung Austin Semiconductor LLC unit. The expanded facilities will be in full operation by late 2011. The Austin plant, which is SamsungÔÇÖs only overseas semiconductor production line and one of the largest fabrication plants in the US, currently produces a variety of NAND Flash memory chips. The production of those chips will continue, Samsung has said. The 12-inch facility was built in 2007. An older fabrication plant, which produced chips on 8-inch wafers, was closed in 2009 and refurbished for metal (copper) process for 12-inch fabrication. Thanks to its manufacturing expansions, Samsung is set to top Hewlett-Packard as the largest maker of technology products by revenue later this year. It is currently the world's second-largest semiconductor maker after Intel. The new money brings SamsungÔÇÖs total investment in Austin to more than $9 billion. Employment at the Austin site will grow from 1,000 employees to about 1,500 by 2011, with the annual payroll expected to increase from $70 million currently to about $105 million. In addition to the Samsung direct employees, almost 3,000 construction workers and equipment vendors will be at the plant to move in and set up the machinery that operates the semiconductor plant. Commenting on the announcement, Dr. W. S. Han, president of Samsung Austin Semiconductor, said: "This investment, along with the creation of Samsung Austin Semiconductor's first research and development entity this spring, makes the Austin campus a true semiconductor complex and ensures Austin's premier status as a center for semiconductor research and manufacturing.ÔÇØ Suwon, South Korea-based Samsung said in May that it plans to invest a record 26 trillion won ($22.7 billion) this year to cater to rising demand and to reinforce its market dominance. The company said it plans to spend 18 trillion won ($14.3 billion) in total on new facilities, including five trillion won ($3.9 billion) for LCD panel production, and a further eight trillion won ($6.3 billion) on research and development. Meanwhile, spending on the semiconductor business would be more than doubled, to about 11 trillion won ($8.7 billion) this year, from 4.5 trillion won ($3.5 billion) in 2009. Along with its rivals, who include Tokyo-based Toshiba and South KoreaÔÇÖs Hynix Semiconductor Inc., Samsung is upping chip production to meet increasing demand for their use in smartphones, cameras and appliances.