CHIPS Risks
Things have become more complicated for global semiconductor makers in receiving subsidies worth US$52 billion (about 68 trillion won) according to the U.S. Department of Commerce’s CHIPS Act.
SK hynix followed Taiwan’s TSMC, the world’s largest foundry company, along with more than 200 other companies in intending to apply for the subsidies. Samsung Electronics is also expected to submit a letter of intent to receive the subsidies. However, chipmakers are expected to try to persuade the U.S. government to ease subsidy payment requirements as the requirements stipulate that the chipmakers submit internal information equivalent to trade secrets to the U.S. government.
The U.S. Department of Commerce’s CHIPS Program Office recently received more than 200 statements of interest (SOIs) from companies, according to industry sources.
The names of the companies that submitted SOIs have not been released, but industry insiders believe that TSMC and Samsung Electronics handed theirs in. TSMC is building two US$40 billion fabs in Arizona, while Samsung is building a $17 billion foundry in Taylor City, Texas. SK hynix, which plans to build a US$15 billion advanced packaging (rear-end process) plant in the United States, has indicated its intention to apply for the subsidies although they will only be allowed to starting on June 26.
“We are actively checking sites for advanced packaging investments in the United States,” said an SK hynix official. “We will apply for the subsidies from the U.S. federal government’s CHIPS Program as soon as the process is completed.”
The U.S. Semiconductor Support Act is a bill that includes US$52.7 billion in financial support and a 25 percent investment tax credit for 10 years.
Korean companies are likely to apply for the subsidies in consideration of various factors including the need to strengthen cooperation with the United States, which has a large number of fundamental semiconductor manufacturing technologies, and the fact that they are making or planning large-scale investments in America. However, chipmakers think that they can hardly accept the U.S. government’s demand to submit some data, which are virtually their business secrets, as a leak of such data could be highly damaging.