SK Hynix to Allot $3.87B to Setup an Advanced Packaging Plant

SK Hynix, the world's second-largest memory chip maker, has announced plans to invest approximately $3.87 billion in building an advanced packaging plant and research and development (R&D) facility for AI products in the U.S. state of Indiana.

The new plant will feature an advanced chip production line aimed at mass-producing next-generation high bandwidth memory (HBM) chips. These chips are currently utilized in graphic processing units (GPUs) that are instrumental in training artificial intelligence (AI) systems, including those used by Nvidia, a major customer of SK Hynix.

Mass production at the new facility, located in West Lafayette, Indiana, is slated to commence in the second half of 2028. Alongside chip production, the facility will also host a packaging R&D line to further advance packaging technologies.

According to SK Hynix CEO Kwak Noh-Jung, the new facility will bolster the resilience of the supply chain for AI chips in the U.S. The decision to establish the facility was influenced by factors such as the availability of engineering talent from Purdue University, the existing infrastructure for chip manufacturing, and support from state and local governments.

This investment aligns with SK Hynix's broader commitment to the semiconductor industry. In 2022, the company pledged to invest $15 billion in various initiatives, including R&D programs, materials development, and the establishment of an advanced packaging and testing facility in the U.S.

Last month, SK Hynix commenced mass production of the latest version of HBM chips, known as HBM3E. These chips are reportedly being supplied to Nvidia, which holds a significant share of the market for AI chips and has been a key customer of SK Hynix, particularly for previous versions of HBM chips such as HBM3.