Samsung to ramp up chip production with £2m investment in Texas facility

Samsung will make a $4 billion (£2 billion) investment in its Austin, Texas chip-manufacturing plant in an effort to boost its ability to meet demands in the fast-growing mobile device market, the company has said.

The investment will go towards renovating the plant’s existing production line, which churns out system chips used in smartphones and tablets. The retrofitting is set to be completed next year, with mass production due to kick off in the second half of 2013.

There will be no layoffs at the plant, Samsung spokesperson Catherine Morse told the Statesman newspaper.

"We are not laying off workers. We are keeping all jobs intact," Morse said. "We will be doing a massive training of workers."

The announcement comes after the company revealed its plans in June to spend 2.25 trillion won (£1.2 billion) on the building of a new logic chip production facility in South Korea and a $4 billion (£2.6 billion) manufacturing plant in China.

Samsung is looking to ramp up its output of logic chips as demand in the smartphone market skyrockets, while suppliers are unable to keep pace.

Demand for system chips used in mobile devices is expected to double to $59 billion (£38 billion) in 2016 from $23 billion (£15 billion) last year, according to research group Gartner.

Earlier this year, the launch of Samsung’s Galaxy S3 smartphone was delayed in some markets as the supply chain struggled to keep up with the device’s popularity. Accordingly, the investment looks poised to preemptively protect Samsung against similar occurrences as it tries to wrest away more of the smartphone and tablet market share from competitors.

The South Korean company is a world leader in memory chip revenue, supplying the likes of Apple with processors for the iPhone and iPad despite the companies’ ongoing patent infringement battle.

Image Credit: The Statesman