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SK hynix commits $14.5 billion to build DRAM line in Cheongju
2024-04-28
SK hynix will commit 20 trillion won ($14.5 billion) to set up an advanced dynamic random memory (DRAM) chip fabrication line in Cheongju, North Chungcheong, in a reversal of its original plan to produce NAND there.
The Korean chipmaker said the change was approved by the board on Wednesday.
The M15X line will be located next to the existing M15 line, and will be dedicated to producing DRAM including high bandwidth memory (HBM) chips. Construction is scheduled to start this month and be completed by November 2025. Early mass production will also start simultaneously.
SK hynix said it plans to invest 5.3 trillion won to build the plant and at least an additional 15 trillion won to purchase chip equipment for the new line over the long term.
"As a global leader in AI memory chips, SK hynix plans to expand investment in its domestic manufacturing base, which is the foundation of our competitiveness," the company said in a release Wednesday. "Through the investment, [SK hynix] plans to contribute to the vitalization of the Korean economy as well as elevate the status of Korea as a chip powerhouse."
SK hynix in 2022 announced a five-year, 15 trillion won plan to set up the M15X line dedicated to NAND memory chips.
After breaking ground, however, the construction was put on hold as the flash memory market faced a downturn while demand for DRAM soared on the back of a global AI chip boom.
"It is neither an adjustment of the original announcement or an additional one, but rather a completely new one," said an SK hynix spokesperson.
The chipmaker said that expanding DRAM capacity was considered essential to coping with increasing demand as it forecast that HBM, the premium type of DRAM for AI chips which it holds firm leadership in, will see demand grow by 60 percent annually in the coming years.
Operations at M15X will commence faster than at the mega chip cluster the company is participating in Yongin, Gyeonggi under the government initiative to make the world's biggest chip hub. The earliest operational time frame for SK hynix' plants in the chip cluster is in 2027.
The company has committed 120 trillion won to the cluster by 2046 to build four chip plants there.
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