(TNS) — A new factory in Georgia will do more than assemble tiny computer chips, but it will also be a big part of U.S. efforts to wrestle back China’s grip on critical technologies.
Absolix, a subsidiary of South Korean conglomerate SK Group, has finished construction on a Covington factory that will produce thousands of glass substrates used in semiconductor manufacturing. The factory is the first of its kind in the United States and marks the start of a domestic supply chain for the computer chips that power everything from smartphones to supercomputers.
While the United States produces only about 10% of the world’s computer chips, China and other Asian countries account for the majority of production and have a near monopoly on manufacturing cutting-edge chip technology. In the wake of the COVID-19 pandemic, a global chip shortage brought many industries to a halt, throwing the United States into disarray until Asian chipmakers restarted assembly lines.
Further geopolitical tensions between the U.S. and China are pushing President Joe Biden’s administration to encourage domestic semiconductor production.
Minjai Cho, Absolix’s director and vice president of business innovation, said U.S. companies are becoming more reliant on such chips, especially with the rise of artificial intelligence, giving them even more incentive to bring such manufacturing capabilities home.
“Most of the end customers are in the U.S., so it’s clear that (the industry) wants to expand into the U.S.,” Cho said.
Federal and state leaders also want semiconductor companies to locate here.
The Biden-Harris administration announced in late May that it would provide up to $75 million to help procure and install equipment at Absolix’s factory in Covington. The grant comes as part of the $280 billion CHIPS and Science Act, which President Joe Biden signed into law in 2022 to help bolster the country’s technology manufacturing industry.
Absolics is the first semiconductor company to receive CHIPS funding, and the announcement was applauded by the Semiconductor Industry Association.
“CHIPS is poised to deliver enormous investment returns and major benefits to the American economy, national security and supply chain resiliency,” said John Neufer, president and CEO of the industry group.
The plant, announced in 2021, was also the first economic development project announced by Gov. Brian Kemp when he took office. A spokesman for the governor said Absolix’s investment in Georgia was the result of state and local policy.
Cho said the plant, about 45 minutes east of Atlanta along I-20, is scheduled to open “no later than September.” He said the 120,000-square-foot facility is a $300 million investment by SK Group and will employ about 200 local workers by the end of the year. The project is poised for expansion, and Cho said the facility could double in size and employee numbers.
The company’s technology was developed in collaboration with Sung Jin Kim, a former electrical engineering professor at Georgia Tech who now works for SK Group. The company’s proprietary glass substrate allows more chips to be mounted on a single device using less energy than the current industry standard, plastic substrates. The first phase of the factory will be capable of producing up to 48,000 glass substrates per year.
The boards are manufactured in Georgia but shipped to Asia for final assembly into semiconductors. Cho said he expects other parts of the computer chip supply chain to also set up shop domestically in the coming years, especially given the growing presence of data center projects and other chipmakers such as Nvidia.
Tech giants and data-center developers are rushing to build giant warehouses packed with computer servers across the country, making metro Atlanta the fastest-growing data-center market in the U.S. The frenzy has raised concerns about the massive amounts of electricity they require and the profitability of government incentives, but data centers are big users of semiconductors and could help further the growth of domestic chip manufacturing.
“As these big players come in, I expect we’ll see more suppliers,” he said. “An ecosystem will build around us.”
©2024 The Atlanta Journal-Constitution. Distributed by Tribune Content Agency, LLC.
