GlobalWafers: "Without US Semiconductor Plant Incentives, Must Head to Korea"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] Taiwanese semiconductor wafer manufacturer GlobalWafers has announced plans to invest $5 billion (approximately 6.4 trillion KRW) to build a wafer production plant in Sherman, Texas, USA. However, it emphasized that if the semiconductor industry incentives in the current U.S. congressional support bill do not pass, the company will have to turn to South Korea instead of the U.S.

According to the Wall Street Journal (WSJ) and others on the 27th (local time), GlobalWafers made this announcement. If this plant is built, it will be the first silicon wafer production facility established in the U.S. in over 20 years. GlobalWafers expects that the construction of this plant will create 1,500 jobs and serve as an opportunity to expand the U.S. semiconductor industry.

Mark England, President of GlobalWafers, said regarding the plant construction that they will request financial incentives included in the so-called semiconductor support bill aimed at expanding semiconductor production in the U.S., and if the bill does not pass, "we will have to turn to South Korea." GlobalWafers is the world's third-largest silicon wafer manufacturer, and if it builds a plant in the U.S., it is expected to help reliably supply wafers to semiconductor manufacturing facilities within the U.S.

This statement from GlobalWafers comes amid the failure of the U.S. semiconductor support bill, which involves a $52 billion investment to foster the semiconductor industry, to pass in Congress. The U.S. Senate passed a bipartisan bill last July to invest a total of $250 billion in key industries including semiconductors and to focus $190 billion on technology development. The House of Representatives is currently reviewing the "America COMPETES Act," which includes a $52 billion investment in the semiconductor industry and supports a total of $300 billion in research and development (R&D) budgets.

There are reportedly significant differences in opinion between the Democratic and Republican parties regarding this. WSJ reported that the Democrats intend to use the semiconductor support bill as a means to curb U.S. inflation. The Republicans, unlike the bipartisan Senate bill, say the House bill was approved through a partisan vote including trade, climate change, and human rights measures, and they want the bill to be revised.

The Biden administration is putting considerable effort into passing this bill. U.S. Secretary of Commerce Gina Raimondo stated that South Korea, Japan, and European Union (EU) member countries are all providing massive subsidies to ensure a stable supply of semiconductors used in consumer goods, industrial, and military products, emphasizing, "We are now at a turning point in the semiconductor supply chain." She warned that if the semiconductor support bill is passed within the next few weeks, many companies can be attracted, but if not, the opposite situation will occur.

Not only GlobalWafers but also Intel CEO Pat Gelsinger postponed the groundbreaking ceremony for the Ohio plant originally scheduled for the 22nd, citing "uncertainty related to the semiconductor support bill" as the reason. CEO Gelsinger warned that Congress must pass the bill before its August recess, and depending on whether the bill passes, Intel will decide whether to expand its Ohio investment beyond the original plan.