Samsung Electronics will invest 100 trillion won to expand domestic semiconductor production capacity

According to Korean media, Samsung Electronics plans to build three more production lines in Pyeongtaek, Gyeonggi-do, South Korea. Considering that each semiconductor factory requires an investment of more than 30 trillion won, Samsung Electronics will invest a total of 100 trillion won (approximately 30 trillion won) for the plan. $74 billion) funding.

As the world's largest semiconductor factory, the Pyeongtaek factory currently has two production lines. The Korea Economic News quoted sources as saying that Samsung Electronics recently started the preliminary construction of the fourth production line of the Pyeongtaek factory, and the construction of the third production line is also expected to be completed. Completed in the second half of the year. After the implementation of the three new production lines, the number of production lines in the Pyeongtaek chip factory will increase to six.

Samsung Electronics Vice Chairman Lee Jae-yong has announced the company's goal to become the world's largest system semiconductor manufacturer by 2030. "Although this year's chip demand has been hit by a slowdown in the electronics and information technology industries, Samsung Electronics is expected to expand its production facilities as the global semiconductor market will gradually grow in the medium to long term," the person said.

Since the beginning of this year, as the global consumer electronics market has cooled, the market demand for chips has also declined. In the market, news about chip cut orders is also emerging one after another. However, in Samsung's view, the global semiconductor market will continue to grow in the medium and long term. In the face of competitive pressure from rivals such as TSMC and Intel, Samsung has recently announced a number of investments.

Just last week, Samsung Electronics announced plans to invest 20 trillion won in building an advanced semiconductor R&D center by 2028 to secure a competitive advantage in the increasingly fierce competition with rivals such as TSMC.

The Pyeongtaek plant is expected to use extreme ultraviolet lithography (EUV) technology to produce the industry's smallest 14-nanometer DRAM chips. In addition, the company will manufacture system semiconductors at 5nm and below process nodes here. All production processes will be automated through intelligent control systems.

Equipment investment in Samsung Electronics' semiconductor division nearly doubled from 23.7 trillion won in 2018 to 43.6 trillion won last year. The number of employees in Samsung Electronics' semiconductor division increased from 52,095 in 2018 to 63,902 last year and is expected to exceed 70,000 by the end of this year. Although Samsung Electronics did not specifically announce the amount of future semiconductor investment, it is expected to continue to increase investment in the semiconductor business.

It is worth noting that in the face of the factory construction subsidy provided by the US government, Samsung did not choose to transfer the above-mentioned production lines to the United States. Samsung's choice once again reflects the ambiguous attitude of foreign companies towards the chip bill. As far as South Korea is concerned, keeping the production line at home is undoubtedly the best choice to survive the global economic downturn.