38 billion dollars! SK Hynix to build two new memory chip factories, with capacity to be gradually expanded based on customer demand

Amid the AI wave, the leading storage chip manufacturer is further increasing its production capacity plans. SK hynix announced it will invest about 54.3 trillion Korean won (approximately $38.282 billion USD) to build two new wafer plants in Yongin and Cheongju, South Korea, expanding DRAM and NAND production bases and gradually increasing capacity according to customer demand, in order to meet the growing requirements for HBM and advanced storage driven by artificial intelligence.

On August 7, according to Yonhap News Agency, the company's board of directors has approved an investment of 35.2 trillion Korean won for the second Yongin wafer plant (Y2) and 19.1 trillion Korean won for the Cheongju M17 plant. SK hynix stated that in the AI era, being able to provide the required capacity to customers when needed is itself a core competitive strength.

According to the plan, investment in both factories will be completed before 2031, with the first cleanroom expected to be put into operation between the end of 2028 and 2029. This means SK hynix is securing advanced storage capacity years ahead of schedule, aiming to consolidate its leading position in the HBM and next-generation DRAM markets.

Yongin Y2 focuses on HBM and next-generation DRAM

Yongin Y2 is the second wafer plant planned in the Yongin semiconductor cluster by SK hynix, with a building area of approximately 341,000 pyeong. Construction is expected to start in July next year and the first cleanroom will be operational by June 2029, mainly producing HBM and other next-generation DRAM products.

This investment not only covers production facilities, but also includes a comprehensive R&D center, staff facilities, and other auxiliary buildings. Meanwhile, the first phase Yongin wafer plant (Y1) currently under construction is progressing smoothly, with its first cleanroom expected to be put into use in February next year.

Of note, SK hynix has brought forward the overall construction schedule for the four wafer plants in the Yongin semiconductor cluster from the originally planned 2045 to 2033. At present, the completion rate of basic infrastructure such as the first phase power and water supply supporting Y2's operations has reached 99%.

Cheongju M17 further improves NAND capacity

Another investment will go to the Cheongju M17 plant, with a total investment of 19.1 trillion Korean won. Construction is planned to begin in February next year with the first cleanroom opening in December 2028.

Cheongju has long been the main base for SK hynix’s NAND flash manufacturing, with plants such as M11, M12, and M15 already in place. The company stated that the new plant will make full use of the local land, power supply, water resources, and established manufacturing systems to speed up construction, and further improve operational efficiency through production synergies.

AI demand drives capacity expansion, but plant deployment remains paced

Although this investment sets a new record, SK hynix has not chosen to release all its capacity at once, but continues to adopt a 'build infrastructure first, add equipment as needed' strategy.

The company plans to first complete factory and supporting facilities according to the timeline, while the expansion of cleanrooms and production equipment investment will be carried out gradually in line with customer demand and market changes, ensuring supply capability while maintaining capital expenditure efficiency.

This decision is also a further implementation of SK hynix’s medium- and long-term investment strategy announced in June this year. According to the plan, the company will invest a cumulative total of around 600 trillion Korean won in the Yongin semiconductor cluster and an additional 100 trillion Korean won in Cheongju production base in the future, supporting the growing global demand for storage chips in the AI era.