SK Hynix to Establish M15 Expansion Fab in Cheongju... Overcoming Memory Market Slump with 'Investment DNA' (Comprehensive)

SK Hynix to Build M15 Expansion Fab... Target Completion in 2025
Investing 15 Trillion Won Over Next 5 Years for Factory Construction and Production Facilities
"Accelerated Investment Despite Economic Downturn to Secure Future Growth Foundation"
Will M15X Mass-Produce NAND Like M15?... M15 Currently Mass-Producing 3D 176-Layer NAND

SK Hynix's 238-layer 512Gb TLC 4D NAND flash unveiled in August / Source=SK Hynix

[Asia Economy Reporter Kim Pyeonghwa] SK Hynix is investing 15 trillion KRW to build a new semiconductor production plant, 'M15X,' in Cheongju, Chungbuk, aiming for completion in early 2025. Amid a market downturn centered on memory semiconductors, the company plans to leverage its proactive investment NDA to secure a foundation for future growth.

The semiconductor industry expects that since M15X is an expansion of M15, it will be capable of mass-producing NAND products focused on advanced processes. SK Hynix emphasized that M15X will be the first production facility to open a new decade after more than 10 years since joining the SK Group in 2012.

SK Hynix to invest 15 trillion KRW to build M15X on a 60,000㎡ site in Cheongju

On the 6th, SK Hynix announced plans to build M15X in Cheongju, Chungbuk, to secure a foundation for future growth. Considering market conditions comprehensively, this is an example of adding an expansion fab to an already secured site. The target completion date is early 2025.

M15X will be located on approximately 60,000 square meters (㎡) of land in the Cheongju Technopolis Industrial Complex in October. It will have a multi-story structure, similar in scale to the combined existing Cheongju M11 and M12 plants but smaller than M15. SK Hynix plans to invest a total of 15 trillion KRW over the next five years for the construction of the M15X plant and production equipment setup.

SK Hynix stated that it decided to start construction of M15X ahead of its internal schedule. Despite the recent sharp decline in memory semiconductor demand due to the global economic downturn and supply chain instability, the company anticipates a market rebound in 2025 and has decided on proactive investment to increase supply. They also explained that M15X could serve as a catalyst for the upcoming semiconductor boom.

SK Hynix production facility complex located in Heungdeok-gu, Cheongju-si, Chungbuk / Source=SK Hynix

Memory semiconductor market growth at 0%... SK Hynix emphasizes "achievements through proactive investment"

SK Hynix's announcement of a new plant has attracted industry attention, especially given the current unfavorable semiconductor market outlook.

According to a survey released by the Korea Chamber of Commerce and Industry on the 5th, 76.7% of 30 domestic semiconductor experts viewed the current situation as a crisis for the semiconductor industry. The difficulties in the semiconductor sector are intensifying due to overlapping factors such as the global economic downturn, inflation concerns, the Ukraine crisis, oversupply of semiconductors, and increased inventory leading to price declines.

In the case of memory semiconductors, SK Hynix's main focus, price declines are particularly pronounced, resulting in poor market conditions. The World Semiconductor Trade Statistics (WSTS) organization rated the growth rate of the memory semiconductor market lower than the overall semiconductor market, forecasting a 0.6% growth rate for memory semiconductors next year. According to market research firm Omdia, SK Hynix ranks 2nd and 3rd in the global DRAM and NAND flash markets, respectively.

Recognizing these market forecasts, SK Hynix reiterated its commitment to proactive investment in announcing the new plant. SK Hynix shared its achievements, stating, "Despite rapid changes in the business environment, we have strengthened our competitiveness in the memory semiconductor market to a global top level through proactive investment."

After joining the SK Group in 2012, when semiconductor industry investments were shrinking, SK Hynix increased its investment by more than 10% compared to the previous year despite being in a deficit, successfully turning a profit by the end of that year. Even though market prospects remained unfavorable afterward, the company built M14 in Icheon in 2015 in preparation for a semiconductor boom, achieving record-high performance for two years starting in 2017.

SK Hynix attributed this approach to the 'Future Vision' announced in 2015. The Future Vision involves investing a total of 46 trillion KRW from 2014 to build three additional plants, including Icheon M14. SK Hynix completed Cheongju M15 in 2018 and Icheon M16 in 2021, achieving the Future Vision ahead of schedule.

Jung-ho Park, Vice Chairman of SK Hynix / Source=SK Hynix

Will M15X mass-produce advanced process NAND like M15?

Looking ahead to M15X's completion in 2025, SK Hynix stated that it is currently undecided which products will be produced there. Given the rapid changes in process technology, it is difficult to specify the exact process level.

The semiconductor industry expects that since M15X is an expansion fab of M15, it will likely mass-produce NAND flash products similar to M15. M15 is known to produce 3D 176-layer and 128-layer NAND products.

The process level may vary depending on future demand. SK Hynix announced last month the development of 4D 238-layer NAND and plans to mass-produce this product in the first half of next year. Since plant construction takes over two years, if advanced processes are applied at M15X, the process level could be even higher.

Park Jung-ho, Vice Chairman of SK Hynix, said, "Looking back over the past 10 years, SK Hynix was able to grow into a global company thanks to bold investments made with foresight despite crises. Now, we must prepare for the coming decade, and the groundbreaking of M15X will be the first step in securing a foundation for future growth."

This content was produced with the assistance of AI translation services.