The plans of Amkor Technology Inc. to build a $2 billion advanced semiconductor packaging manufacturing plant in Peoria, Arizona are moving forward with support from the US Department of Commerce.
The Tempe, Arizona-based technology maker announced plans for the Outsourced Semiconductor Assembly and Test, or OSAT, facility last fall. According to the company, it would be Amkor’s first OSAT in the US and the largest OSAT built in the US to date.
Last month, the U.S. Department of Commerce announced that it had reached preliminary non-binding terms with Amkor to provide the company with $400 million in direct financing plus up to $200 million in CHIPS Act loans and Science 2022, which established $39 billion to support the construction, expansion and modernization of domestic semiconductor manufacturing plants. Amkor also indicated that it plans to claim an investment tax credit that could cover up to 25% of certain costs.
“One of the fundamental goals of the CHIPS and Science Act is to create an advanced packaging ecosystem in the United States to ensure that complete end-to-end chip production occurs domestically,” said Commerce Secretary Gina Raimondo, in a statement. “Advanced packaging drives chip innovation at every level.”
Peoria has also committed to covering $3 million in infrastructure costs to host the facility.
Amkor plans to have more than 500,000 square feet of cleanroom space at the 55-acre Peoria campus. It aims to have the first phase of the manufacturing facility ready in three years. The company did not immediately respond to inquiries about the project’s procurement.
The company has already lined up its first customer for the installation, Apple. Amkor says it worked with Apple on its plans for the plant, as the facility will package and test chips produced for Apple nearby by TSMC at its plants under construction in Phoenix. In semiconductors, “packaging” refers to the casing around the semiconductor, which protects and provides connection to other chips.
“Amkor’s Arizona facility will allow us to support the growing semiconductor manufacturing community … and we look forward to providing our customers with domestic advanced packaging and test capabilities,” said Giel Rutten, President and CEO of Amkor, in a statement.
