SK Hynix invests an additional KRW 5 trillion to build a new DRAM factory… a total of KRW 20 trillion

SK Hynix has decided to increase its investment in a semiconductor factory in Cheongju, North Chungcheong Province by 5 trillion won more than originally planned. The strategy is to build more DRAM factories to preemptively respond to the demand for artificial intelligence (AI) semiconductors.

SK Hynix announced on the 24th that it would invest 5.3 trillion won in the construction of a new semiconductor plant, M15X, to be built in Cheongju, North Chungcheong Province. Previously, the company announced plans to build an additional M15X on an area of ​​60,000 m2 right next to the existing NAND factory, M15, in 2022. Construction had been postponed due to the shrinking memory market, but is now resuming. An SK Hynix official said, “As demand for high-bandwidth memory (HBM) continues to increase, we have increased investment based on the judgment that we need to expand production capacity for DRAM required for HBM production.”

Construction will begin at the end of this month. SK Hynix plans to begin mass production after completion in November 2025. After the equipment is installed, a total investment of 20 trillion won will be made in the M15X. Kwak No-jeong, CEO of SK Hynix, said, “I am confident that this investment will be a big step that will contribute to the future of the national economy beyond the company.”

Meanwhile, SK Hynix is ​​said to be closely examining whether additional investment is needed to respond to rapidly increasing demand for memory. There are voices in the semiconductor industry that direct incentives, such as subsidies, are essential for additional investment to occur domestically. The United States succeeded in attracting factories of foreign companies such as TSMC, Samsung, and Hynix with the ‘Chips Act subsidy’ worth 73 trillion won. On the other hand, in Korea, the only tax credit is 15% for facility investment. An official in the semiconductor industry said, “Domestic companies are in danger of losing cost competitiveness to latecomers who benefit from subsidies,” and added, “Subsidy support measures like those in the U.S. and Europe are absolutely necessary.”