SK Hynix will inaugurate a new chip packaging plant in the United States early next year

The logo of SK Hynix is ​​seen at its headquarters in Seongnam, South Korea April 25, 2016. REUTERS/Kim Hong-Ji

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WASHINGTON, Aug 11 (Reuters) – South Korea’s SK Hynix aims to select a U.S. site for its advanced chip packaging plant and innovate there around the first quarter of next year, two people familiar with the matter said. helping the United States to be competitive. as China pumps money into this booming sector.

The factory, estimated to cost “several billions”, would go into mass production by 2025-2026 and employ around 1,000 workers, one of the sources said, declining to be named as details of the plant have not been made public.

It would likely be located near a university with engineering talent, the person said.

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The company “hopes to do site selection and innovation around the first quarter of next year,” one of the people said.

SK Group, South Korea’s second-largest conglomerate, owns memory chipmaker SK Hynix (000660.KS) and announced the new factory last month as part of a $22 billion investment package Americans in semiconductor, green energy and bioscience projects. Read more

The announcement, announced by the White House, said $15 billion would be allocated to the semiconductor industry through research and development programs, materials and the creation of a packaging facility and advanced testing.

“R&D investments will include building a nationwide network of R&D partnerships and facilities,” the source said, adding that the packaging facility would package SK Hynix memory chips with logic chips designed by other manufacturers. other US companies for machine learning and artificial intelligence applications.

The company, following the Reuters report on the timing of groundbreaking, confirmed that it plans to select a site for the plant in the first half of next year, but said that no decision had been made on when to begin construction.

The United States has long handed over most basic, low-value chip packaging operations to overseas factories, mostly in Asia, where chips are placed in protective frames that are then tested before being shipped. electronics manufacturers.

But new battle lines are being drawn in the race to develop advanced packaging techniques, which involve placing different chips with different functions in a single package, improving overall capabilities and limiting the additional cost of more advanced chips.

“While the United States and its partners have advanced packaging capabilities, China’s massive investments in advanced packaging threaten to disrupt the market in the future,” the White House said in a 2021 report.

An executive from major Chinese chipmaker SMIC (0981.HK), which was added to a US trade blacklist in 2020, said last year that Chinese companies should focus on advanced packaging to overcome their weaknesses in the development of more sophisticated chips, according to the report.

The SK group’s move comes after Biden signed into law the CHIPS Act this week, providing $52 billion in subsidies for chip manufacturing and research, as well as an estimated $24 billion investment tax credit. dollars for chip factories. The sources said the R&D facilities and the chip packaging plant would both be eligible for funding.

There has been a flurry of expansion plans announced by chipmakers in the US in recent years, from Taiwan Semiconductor Manufacturing Co (2330.TW) to Samsung Electronics (005930.KS) and Intel (INTC.O) .

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Reporting by Alexandra Alper; Additional reporting by Karen Freifeld; Editing by Chris Sanders, Alexandra Hudson and Tom Hogue

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