Chip Giants Samsung and SK Hynix Consider Fresh Investments

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South Korean chip giants, Samsung and SK Hynix, are considering new investment plans for production facilities. This comes as the global AI industry pushes solid demand for cutting-edge chips used in data centers and servers. The country’s government may also support the expansion of semiconductor hubs.

Samsung, SK Hynix eye chip facility expansion to support AI demand

According to a report from Nate, Samsung and SK Hynix may announce plans for large-scale regional investments as early as next week. The plans could include both front-end manufacturing plants and back-end facilities to establish a semiconductor ecosystem.

In recent years, the need for additional capacity has increased rapidly. This is due to the robust demand for high-performance chips, particularly High Bandwidth Memory (HBM). These chips power AI systems and help process large amounts of data at high speed.

Kim Yong-beom, a policy adviser to South Korean President Lee Jae Myung, said Samsung and SK Hynix need to “speed up ​the ongoing construction of new chip facilities by more than ‌10 ⁠years to 2034-2035.” He also said, “Looking ahead to the next stage ​after seven or eight ​years, ⁠we are faced with the challenge of finding a massive ⁠new ​site for a second ​cluster.”

Industry watchers believe the new investment plans could be worth hundreds of trillions of won. The Honam and Chungcheong regions could be the locations for new semiconductor hubs. As of now, Samsung’s major investments go to Pyeongtaek and Yongin. Likewise, SK Hynix’s investment focus centered on large facilities in Icheon, Cheongju, and Yongin.

If new hubs are built in more regions, South Korea’s semiconductor industry could see greater geographical diversity. More importantly, they would also reduce the industry’s dependence on production bases in the Seoul metropolitan area. It is worth mentioning that Samsung already plans to invest 450 trillion won in South Korea over the next five years, with a portion allocated to semiconductor expansion.

Written by

Binay Konwar

Binay Konwar started his blogging journey in 2014 and has since written plenty of tech articles. At present, he is working as a News Writer at SammyGuru, covering everything about Samsung. He holds a Master's degree in Mathematics, but his real passion lies in tech and writing. In his free time, he enjoys playing chess and watching movies.

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