SK Hynix announced that it will invest a total of 20 trillion won in Cheongju M15X as a DRAM production base

Eric April 24, 2024

According to reports, on April 24, 2024, SK Hynix, an internationally renowned memory chip manufacturer, announced that it has decided to expand the production Capacity of next-generation DRAM, such as HBM, which is the core product of AI infrastructure (Infra), in order to cope with the surging demand for semiconductors used in AI.

On the same day, the company passed a board of directors decision to establish the M15X in Cheongju, North Chungcheong Province as the new DRAM production base and to invest about 5.3 trillion won in the construction of the Fab.

SK Hynix will start construction at the end of this month, and the project is scheduled to be completed and mass-produced in November 2025. At the same time, the company will also invest in equipment in turn. In the long run, the M15X project will invest more than 20 trillion won to effectively expand and increase production capacity.

SK Hynix emphasized that as a global leader in the memory field for AI applications, the company hopes to contribute to activating the momentum of the Korean economy by increasing investment in its production base in Korea, while strengthening its position as a semiconductor power.

With the advent of the AI era, the semiconductor industry believes that the DRAM market has entered a medium - to long-term growth era. The company predicts that HBM, which is expected to grow at an annual rate of more than 60 percent, and ordinary DRAM products, mainly high-capacity DDR5 modules for servers, will continue to increase in demand.

In this market trend, to ensure that the production of HBM products reaches the same level as that of ordinary DRAM, at least twice the production capacity relative to ordinary DRAM is required. The company believes that increasing the DRAM production capacity, mainly HBM, is one of the top issues at present. Accordingly, SK Hynix has decided to produce next-generation DRAM products at the M15X plant in Cheongju before the completion of the first plant in the Yongin Semiconductor cluster (the first half of 2027). The company also considered the location of the M15X plant, which is adjacent to the M15 plant, which is expanding its TSV* production capacity, to further optimize HBM production.

Along with the M15X project, SK Hynix also plans to invest 120 trillion won in the Yongin Semiconductor cluster. The investment plan is currently on the drawing board. At present, the construction progress of the land under construction of the Longin Semiconductor cluster is about 26%, which is 3 percentage points faster than the expected project target. At present, the company has completed the land compensation and cultural heritage investigation for the layout of production facilities; The construction of infrastructure such as electricity, water and roads is also proceeding faster than planned. The company plans to start construction of the first plant of the Yongin Semiconductor cluster in March next year and complete it in May 2027.

In addition, SK Hynix's domestic investment plays an important role in SK Group's overall domestic investment in Korea. Since its merger with SK Group in 2012, the company has invested a total of 46 trillion won since 2014. Starting with the M14 plant in Icheon, the company has continued to increase its investment in Korea with the Future Vision of building three more plants. In the end, the company completed the M15 plant in Cheongju in 2018 and the M16 plant in Icheon in 2021, achieving its future vision ahead of schedule. The M15X and Yongin Cluster investment that will follow will help South Korea become an AI semiconductor power, occupying an important position in another field of chips, and will also become one of the important traction forces to stimulate the national economy.

SK Hynix CEO Kwak Noh-jeong said, "The M15X will be a key facility to provide AI application memory to the world and a stepping stone to the company's future. I am confident that this investment will not only help the company, but also contribute to the future development of the national economy."