In 2021, the South Korean company Samsung Electronics announced its intention to build a second facility in the state of Texas, which would serve third-party customers in the field of semiconductor components. The original cost estimate was $17 billion, but at current prices it has reached $25 billion, largely due to higher construction costs.
The increase in the project's budget by $8 billion is due to almost 80% of the growth in construction costs in the United States. The inflationary component in this case determines the growth of core costs for building materials. Wages in the US construction industry have also risen since 2021.
The US government is ready to allocate about $39 billion over the next five years directly to subsidize the construction of enterprises for the production of semiconductors in the country. According to the US Department of Commerce, the main part of government subsidies will cover no more than 15% of the cost of building fabs.
Samsung is rushing to complete the Texas facility by 2024 in order to launch production in 2025. This will allow the Korean manufacturer to claim tax deductions for purchased fabrication equipment. The deadline for putting the enterprise into operation is 2026. Samsung has reportedly spent about half of its original $17 billion budget, but rising costs are unlikely to stop it as it looks to build additional US facilities anyway.