South Korean Chipmakers Accelerate Facility Investments Amid Booming AI Demand

South Korean Chipmakers Accelerate Facility Investments Amid Booming AI Demand

South Korean chipmakers, including Samsung Electronics and SK Hynix, are ramping up investments in production facilities to capitalize on the booming demand for artificial intelligence (AI) chips. The move is driven by forecasts of rapid growth in the AI chip market, which is projected to grow from $41.1 billion in 2022 to $133 billion by 2028.

Samsung Electronics is reviewing plans to restart construction of its Pyeongtaek Campus Line 4 facility, which was halted last year. The facility is expected to manufacture sixth-generation 1c DRAM using a 10-nanometer process for next-generation high bandwidth memory (HBM4) chips. This strategic move is aimed at meeting the increasing demand for advanced memory chips that power AI processors.

SK Hynix is also expanding its production capabilities, building a new back-end processing facility, dubbed "P&T 7," in Cheongju, to enhance packaging capabilities and boost performance and energy efficiency of advanced chips. The company is scaling up production capacity with its new M15X plant, expected to produce fifth-generation 10nm-class DRAM chips for HBM4 products.

The global AI semiconductor market is expected to triple by 2028, driving these strategic expansions. The DRAM market is also expected to remain strong in the second half of the year, driven by demand for HBM chips that power AI processors. Samsung's Vice Chair Jun Young-hyun, who oversees the company's semiconductor division, recently met with Nvidia, signaling the company's commitment to closing the gap with competitors and securing new HBM chip orders.

With these investments, South Korean chipmakers are positioning themselves to capitalize on the growing demand for AI chips and maintain their competitive edge in the global semiconductor market.

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