U.S. Secures $1.5 Billion CHIPS Act Deals With Amkor and SKhynix for Semiconductor Packaging Facilities

In a significant boost to the semiconductor landscape in the U.S., the CHIPS & Science Act has mobilized tens of billions of dollars in grants and loans to giants like Intel, Samsung, and TSMC. This move is set to vastly expand domestic chip production over the next few years. However, a critical part of this puzzle—testing, assembly, and packaging—mostly takes place in Asia, which creates a gap in the U.S. supply chain. To bridge this, the U.S. government recently inked memorandums of understanding worth approximately $1.5 billion with Amkor and SK hynix. These agreements aim to support the establishment of chip packaging facilities stateside, thus completing the missing piece of this domestic production strategy.

### Amkor’s Plans for an Apple-Centric Packaging Facility

Amkor is gearing up to invest $2 billion in an advanced packaging facility near Peoria, Arizona. This site will primarily focus on processing chips manufactured by TSMC at their nearby Fab 21 facility in Phoenix. Under the CHIPS & Science Act, Amkor secured a memorandum of understanding that grants $400 million in direct funding along with $200 million in loans. The company will also benefit from a 25% investment tax credit on qualifying capital expenditures.

Strategically set near TSMC’s upcoming Fab 21, Amkor’s facility will span 55 acres and boast over 500,000 square feet of cleanroom space, making it more than twice the size of its Vietnamese counterpart. While specific capacity details and technologies are under wraps, it’s expected to serve a multitude of sectors, including automotive, high-performance computing, and mobile technology. This implies a broad array of packaging solutions will be offered, covering traditional, 2.5D, and 3D technologies.

A noteworthy collaboration with Apple has been a key aspect of the Peoria facility’s vision and initial development, with the tech giant anticipated to be its first and most substantial client. This partnership underscores the new plant’s potential to strengthen the U.S. semiconductor supply chain and positions Amkor as a crucial ally for companies leveraging TSMC’s manufacturing prowess. The facility is projected to create around 2,000 jobs and is targeted to launch operations in 2027.

### SK hynix’s Bold Move with HBM4 in the U.S.

Joining the momentum, SK hynix has entered into a preliminary agreement with the U.S. government, securing up to $450 million in direct funding and $500 million in loans. This financial backing will support the development of an advanced memory packaging facility in West Lafayette, Indiana.

Slated to begin operations in 2028, this facility is aligned with the assembly of HBM4 or HBM4E memory. The DRAM components for these high-bandwidth memory stacks will continue to be fabricated in South Korea. Nonetheless, finishing and potentially integrating these memory modules with elite processors in the U.S. marks a significant milestone.

Beyond the construction of its packaging site, SK hynix aims to partner with Purdue University and other local research bodies to propel semiconductor technology and packaging innovation. This collaboration is poised to enhance research and development efforts regionally, establishing the facility as a nexus for AI technology and skilled employment opportunities.

Sources: Amkor, SK hynix