U.S. Inks $1.5B CHIPS Act Deals with Amkor and SKhynix for Chip Packaging Facilities

In a strategic move to bolster the U.S. semiconductor industry, the CHIPS & Science Act is making waves with its massive funding infusion. The government is pumping tens of billions of dollars into chip-making giants like Intel, Samsung, and TSMC to ramp up semiconductor production on American soil. Yet, there’s been a hitch: most chips undergo testing, assembly, and packaging in Asia, leaving the U.S. supply chain a bit fractured. Tackling this challenge head-on, the U.S. government has inked memorandums of understanding worth about $1.5 billion with Amkor and SK hynix in recent weeks. These agreements aim to kick-start efforts to build chip packaging facilities stateside.

Amkor Teams Up with Apple for Advanced Packaging in Arizona

Amkor has ambitious plans to develop a $2 billion advanced packaging facility close to Peoria, Arizona. This site will focus on testing and assembling chips manufactured by TSMC at their nearby Fab 21 in Phoenix. Through the CHIPS & Science Act, Amkor secured a memorandum of understanding granting them $400 million in direct funding, plus another $200 million in loans. They’re also planning to capitalize on a 25% investment tax credit for eligible capital expenditures.

Positioned strategically near TSMC’s forthcoming Fab 21 complex in Arizona, Amkor’s effort will transform a 55-acre plot into a bustling hub with over 500,000 square feet of cleanroom space. That’s a jaw-dropping scale more than double the size of its current advanced packaging site in Vietnam. Although the company has yet to divulge specific capacity details or exact technologies it plans to support, expectations are high. The facility’s diverse offerings are set to appeal to industries ranging from automotive to high-performance computing and mobile technologies. This means we’ll likely see an array of packaging techniques, including traditional, 2.5D, and even 3D technologies, coming to life here.

Amkor’s endeavor has a crucial ally: Apple. The tech titan has been closely involved in the planning stages, lining up as the facility’s key customer. This collaboration not only underscores the facility’s significance in strengthening the U.S. semiconductor supply chain but also elevates Amkor’s standing as a vital partner for companies utilizing TSMC’s manufacturing prowess. Ready to create around 2,000 jobs, this project is on track to begin operations by 2027.

SK hynix Ventures into U.S. Soil with HBM4

SK hynix isn’t lagging. They’ve just settled a preliminary deal with the U.S. government to receive up to $450 million in direct funding and an impressive $500 million in loans. The goal? To construct an advanced memory packaging facility in West Lafayette, Indiana.

Expected to kick off operations in 2028, this facility will focus on assembling HBM4 or its enhanced version, HBM4E memory. While South Korea will continue producing DRAM devices essential for HBM stacks, assembling and possibly integrating these finished modules with top-tier processors in the U.S. is a notable game-changer.

SK hynix isn’t stopping at just building a facility. They’re collaborating with Purdue University and other local research entities to push the envelope in semiconductor innovation. This partnership will not only drive research and development but also position the facility as a powerhouse for AI technology and regional employment opportunities.

In essence, the landscape of semiconductor manufacturing in the U.S. is on the brink of transformation, with Amkor and SK hynix leading the charge. The ripple effect of these developments is poised to reinforce the country’s tech backbone, propelling it toward a more self-sufficient future in chip production.

(Source: Amkor, SK hynix)