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The Korea Herald
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THE INVESTOR
March 28, 2024

Industrials

SK hynix pours W3tr to beef up memory chip production

  • PUBLISHED :December 22, 2016 - 18:13
  • UPDATED :December 22, 2016 - 18:13
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[THE INVESTOR] SK hynix, which has recently become the nation’s second-largest company by market capitalization on its upbeat chip sales, said on Dec. 21 it will pour a combined 3.15 trillion won (US$2.63 billion) to beef up production of memory chips.

The company plans to spend 2.2 trillion won to build a new NAND plant in Chengju, North Chungcheong Province, while the remaining 950 billion won will be used to boost the production capacity of DRAM chips at its Chinese plant in Wuxi.




DRAM that is used for temporary data storage in smartphones and PCs still makes up almost 70 percent of the company’s memory chip sales. More recently, the company is shifting its strategic focus to NAND whose demand is soaring for long-term storage in cloud and Internet of Things services.

The average prices of DRAM and NAND chips are expected to significantly improve in the fourth quarter, buoyed by stronger demand for laptops and a supply shortage in the NAND market, according to industry data.

Park Sung-wook, chief executive of SK hynix, said the new plant in Cheongju “will become a core base of SK hynix in facing the fourth industrial revolution.”

The new plant will be located on a 234,000 square-meter site within an industrial complex in the city, some 120 kilometers south of Seoul. The construction will start in August next year and plans to be completed by June 2019.

The schedule for equipment installation and operation will be decided after that considering market conditions and technological capabilities.

The company has started mass-producing the latest 48-layer 3-D NAND chips in November, becoming the world’s second chipmaker to do so following Samsung Electronics.

With the planned production, the company’s NAND chip output is expected to more than double from the current 10,000 units of the 12-inch wafers per month to some 20,000 to 30,000 units at the end of this year.

While its rivals such as Toshiba and Micron are still struggling with the chip manufacturing technology, SK hynix hopes to widen the gap with them as it is already working on the next-generation 72-layer design with aims to start production in the latter half of next year.

In the meantime, the Wuxi plant that has produced almost half the DRAM production of SK hynix will start expansion work from July next year until April 2019 for the planned adoption of more sophisticated manufacturing technologies.

By Lee Ji-yoon (jylee@heraldcorp.com)

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