Samsung Plans to Triple Its Chip Production Efforts to Combat Ongoing Shortage and Take on TSMC

Samsung Plans to Triple Its Chip Production Efforts to Combat Ongoing Shortage and Take on TSMC

Samsung trailing behind TSMC would be an understatement, but the Korean giant has plans to turn things around while combating the ongoing chip shortage at the same time. During its third-quarter earnings, the company announced that it aims to triple its chip production capabilities.

Samsung’s Plans Will Not Happen With a Snap; Reaching Its Goal of Tripling Chip Production Will Take Several Years

At this time, Samsung’s market share in the foundry business stands at 17 percent, and it is the second biggest manufacturer of semiconductors. However, its biggest rival in this industry, TSMC, stands tall with a 53 percent market share. With that being said, Samsung has a ton of ground to cover, and according to Nikkei Asia, it plans on reducing that disparity by tripling its chip production efforts.

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Han Seung-hoon, a Samsung executive, said the following during the company’s earnings conference call.

“We plan to expand our capacity about three times by 2026 to meet customers' needs as much as possible by expanding capacity in Pyeongtaek as well as considering establishing a new plant in the U.S.”

Samsung’s efforts are not just limited to its home turf in South Korea but have extended to the U.S. too. According to a previous report, the company was close to finalizing its $17 billion chip plant in Texas, and that is not the only ambition the chip manufacturing giant has laid out. Back in 2019, we reported that Samsung aims to invest $115 billion by 2030 to gain an edge in the mobile chips category and take on not just Qualcomm, but Apple too.

The company also announced previously that it has plans on mass producing 3nm chips in the first half of 2022. These 3nm chips will offer a 35 percent performance jump and 50 percent power savings compared to its 7nm LPP nodes, but it is not confirmed how it will fare against TSMC’s own 3nm offerings. The efforts to triple chip production will also be beneficial to sate the chip shortage, which has forced TSMC to not just introduce price hikes for its next-generation wafers but also to start prioritizing partners who are not stockpiling chips.

Bringing some much-needed competition to the foundry business will encourage competition, forcing both manufacturers to push forward in bringing cutting-edge chips to the market while also giving options to companies like Apple and Qualcomm. Relying on a single manufacturer can stifle competition, but Samsung’s goal will not reach completion in a few days, but it has plans to triple chip production by 2026.

News Source: Nikkei

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