U.S.-based Amkor's expansive chip packaging plant in Arizona may alleviate the issue of sending domestically manufactured chips abroad for packaging and testing, potentially fortifying America's aspirations in the semiconductor industry.

In a significant development for the U.S. semiconductor industry, Amkor Technology has announced plans to build a state-of-the-art advanced packaging and test facility in Peoria, Arizona. The project, valued at $2 billion, is expected to create a workforce of 70,000-90,000 workers and is reportedly the most ambitious U.S.-sited outsourced semiconductor packaging operation ever announced.

The facility, located on a 104-acre site in Peoria's Innovation Core, will replace an originally designated plot in nearby Vistancia. This expansion is a response to Amkor Technology's growing operational needs and a commitment to support future growth in the industry.

The facility will be designed to support high-performance packaging platforms, including TSMC's CoWoS and InFO technologies. TSMC has already signed a memorandum of understanding to offload packaging from its Phoenix fabs to Amkor's facility. This partnership is expected to address capacity ceilings that companies like Nvidia have faced due to limited packaging throughput.

The U.S. semiconductor industry is experiencing a worker shortfall of 70,000-90,000 workers across all planned facilities. Amkor Technology acknowledges this as a significant challenge and admits that high automation will not fully address the talent crisis. The revised plan for the facility was approved by the Peoria City Council on August 29, and construction is expected to begin imminently, with production expected in early 2028.

Apple is reportedly the first and largest customer for the facility in Peoria, Arizona. The project is part of an effort to keep the U.S. relevant in the chips industry and counter the industry's trend of outsourcing to Taiwan and South Korea. The shift in performance gains from raw transistor counts to how well those transistors are connected is a key focus of advanced packaging, making this facility a crucial step towards U.S. competitiveness in the global semiconductor market.

The facility in Peoria, Arizona, is not only a significant investment in the U.S. semiconductor industry but also a testament to the city's commitment to innovation and economic growth. With the support of the CHIPS Act funding and access to federal tax credits, the facility is poised to make a substantial impact on the industry and the local economy.