Samsung and SK Hynix Accelerate Construction of Semiconductor Plants to Address Memory Shortages

South Korean memory chip manufacturers Samsung and SK Hynix are expediting the development of new semiconductor fabrication facilities to address ongoing global memory shortages. Both companies are intensifying their construction schedules in response to recent disruptions in the supply of DRAM and high-bandwidth memory (HBM), components that are critical for a wide range of computing and artificial intelligence applications.

According to reports from leading South Korean media, initiatives in key industrial areas such as Yongin and Pyeongtaek are being pushed forward earlier than initially planned. The first production line in the Yongin 'megacluster' was originally intended to be operational by May 2027; current projections indicate that preliminary production could commence as early as February or March 2027. Similarly, Samsung is accelerating the completion of its fourth facility in Pyeongtaek, aiming for an opening in the fourth quarter of 2026 instead of the previously targeted first quarter of 2027.

The primary focus for these new plants is on increasing the output of DRAM, especially DDR5 modules, and high-bandwidth memory, both of which are experiencing heightened demand from the computing sector. These expansions are expected to enhance the annual memory production capacity of these companies by over ten percent. Market research data suggests that Samsung could increase its wafer processing to between 100,000 and 120,000 wafers per month in the new facility, building on an estimated annual output of over 8 million wafers by 2026.

Despite the accelerated construction timelines, there will be a delay before the new capacity significantly impacts the supply chain. It is typical for new semiconductor plants to require at least six months of testing and calibration before they can begin mass production. Additionally, the process of manufacturing and distributing memory chips takes several months, meaning that noticeable improvements in memory availability are not expected until the end of 2027 at the earliest.

The world's third-largest memory manufacturer, Micron, is also engaged in building new plants, though these projects are subject to similar lead times. The current wave of construction is a strategic response to both supply chain challenges and increased competition from Chinese manufacturers such as YMTC and CXMT, who are making advances in DRAM and NAND-Flash production. In light of these developments, some PC and notebook manufacturers have reportedly considered sourcing memory from Chinese suppliers to mitigate potential shortages.

Previous delays in new factory plans stemmed from a downturn in market demand in 2023, which led to significant financial losses for many industry leaders. However, the recent surge in demand, driven by sectors including AI, data centers, and high-performance computing, has prompted a renewed urgency to expand manufacturing capacity.

Industry observers note that the acceleration of these projects highlights the critical importance of semiconductor supply chains to the global technology sector. As manufacturers ramp up investments in infrastructure, the competitive landscape is expected to intensify, with companies racing to secure their positions in the memory market and ensure the stability of supply for their global client base.