Stories
South Korean Chipmakers Plan Memory Expansion to Counter Chinese Rivals
- •South Korean semiconductor giants like Samsung Electronics and SK hynix could leverage expanding memory production capacity to reclaim market share from Chinese competitors.
- •China has expanded its presence in conventional DRAM due to supply shortages created as Korean manufacturers shifted focus toward high-margin AI memory chips.
- •Experts estimate the current memory shortage stands at 30 to 40 percent, driven largely by surging demand for AI infrastructure.
- •Major new manufacturing facilities planned in Yongin and Pyeongtaek aim to significantly boost output, though analysts warn of potential oversupply risks if AI demand slows.
Key Questions Answered
South Korean semiconductor manufacturers like Samsung Electronics and SK hynix can increase their production capacity to supply both high-margin artificial intelligence memory and price-sensitive conventional DRAM. By expanding output, they can regain market share from Chinese rivals such as ChangXin Memory Technologies (CXMT) that have capitalized on shortages in lower-priced chips.
Kim Hyung-joon, head of the Next Generation Intelligence Semiconductor Foundation, estimated that the current memory shortage stands at 30 to 40 per cent. This figure is significantly higher than historical supply imbalances of around 2 per cent that typically caused sharp price movements.
SK hynix plans to build four fabrication plants at its Yongin semiconductor cluster south of Seoul, with the first plant expected to process around 350,000 wafers monthly. Meanwhile, Samsung is planning six fabrication plants at a separate Yongin complex alongside ongoing expansions at its Pyeongtaek campus.
