U.S.-based Amkor's mega chip manufacturing facility in Arizona could potentially address the nation's chip shortage predicament. The advanced packaging plant could prevent the shipment of U.S.-produced chips overseas for packaging and testing.
Amkor Technology's Groundbreaking $2 Billion Semiconductor Packaging Facility in Peoria, Arizona
In a significant move for the semiconductor industry, Amkor Technology is set to build a state-of-the-art advanced packaging and test facility in Peoria, Arizona. The facility, backed by $407 million in CHIPS Act funding and access to federal tax credits, will be the most ambitious U.S.-sited outsourced semiconductor packaging operation ever announced.
Located on a 104-acre site in Peoria's Innovation Core, the facility will replace an originally designated plot in nearby Vistancia. The revised plan was approved by the Peoria City Council on August 29, and construction is set to begin imminently, with production expected in early 2028.
The facility will support high-performance packaging platforms, including TSMC's CoWoS and InFO technologies. TSMC has signed a memorandum of understanding to offload packaging from its nearby Phoenix fabs to Amkor's facility in Peoria, Arizona.
The post-Moore's Law era has shifted performance gains from raw transistor counts to how well those transistors are connected. This shift is reflected in the technology that will be used at the Amkor facility, which is part of a larger effort to keep the U.S. relevant in the chips industry, increasingly defined by multi-die complexity.
However, the success of the facility is not without challenges. The shortage of workers across all planned U.S. fabs is projected to be between 70,000-90,000 workers. High automation alone will not be sufficient to address this talent crisis, making it a significant challenge that Amkor Technology needs to overcome for the successful operation of the facility in Peoria, Arizona.
The pain of GPU shortages and AI server bottlenecks is not expected to be alleviated before 2028, as the Amkor facility in Peoria, Arizona, is set to begin production in early 2028. Nvidia's H100, for instance, previously hit capacity ceilings due to limited packaging throughput.
The relocation of Amkor Technology's building from Vistancia to the Innovation Core of the City of Peoria was chosen to leverage closer proximity to innovation hubs, enhance collaboration opportunities, and benefit from the city's strategic development focus on technology and business growth. The facility is expected to have a workforce of 70,000-90,000 workers.
The Amkor Technology facility in Peoria, Arizona, is expected to play a crucial role in addressing the U.S.'s lag in advanced packaging compared to Taiwan and South Korea. The facility's contribution to the semiconductor industry is anticipated to help alleviate the ongoing issues of GPU shortages and AI server bottlenecks, making it a significant step forward for the industry.
