SK Hynix aiming to break ground on US chip packaging facility in early 2023

SK Hynix is planning to select a site in the US for a future chip packaging plant and break ground as soon as the first quarter of 2023 according to sources familiar with the matter as reported by Reuters. The sources were not named as they are unauthorized to speak on the topic considering the details aren’t yet public.

It’d be a major win for the US as it continues to compete with rival chipmakers in China and move more chipmaking facilities stateside. SK Hynix is a subsidiary of SK Group and is the second largest semiconductor maker in South Korea behind Samsung.

One source said the facility will have an estimated cost of several billions, and could be ready to enter mass production by 2025-2026. The plant would employ roughly 1,000 people and could be located near a university for access to fresh engineering talent.

An SK Hynix rep confirmed to Reuters that it plans to select a construction site next year but hasn’t made a decision on where to build.

Earlier this week, President Joe Biden signed a bipartisan bill into law that aims to boost the country’s competitiveness with China on the chipmaking front. The Chips and Science Act includes more than $52 billion in funding to boost research and manufacturing in the US.

As the South China Morning Post highlights, the law’s passage could help the US create the so-called Chip 4 Alliance between itself, South Korea, Taiwan and Japan, to put additional pressure on China among supply chains.

Notably, those who receive a subsidy under the Chips Act are barred from expanding production in China beyond “legacy” 28-nanometer products for a period of 10 years. If factories in China are unable to upgrade their manufacturing tech, they would seemingly lose their competitiveness.

SK Group in July said it would spend $22 billion on manufacturing, bio science research and green energy in the US. Of the investment, $15 billion will go directly toward semiconductor R&D and the creation of the aforementioned advanced packaging facility.