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August 23, 2019

Samsung rumored to expand US chip plants amid Japan’s trade curbs

PUBLISHED : July 22, 2019 - 15:11

UPDATED : July 22, 2019 - 15:11

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Tech giant Samsung Electronics has reportedly been considering beefing up chip production lines in the US, in the wake of the trade feud between South Korea and Japan.

Austin, Texas, where Samsung runs a foundry business, is one of the candidate regions, according to the reports.




“Samsung seems to consider constructing additional chip plants in the US to respond to Japan’s tightened regulations on chemical products for chips,” an industry official was quoted by local news outlet Yonhap News Agency as saying.

“If the plan is realized, Samsung will be able to have the world’s strongest safeguard -- the US,” the official added.

The South Korean tech firms is currently running the S2 line to produce chips for corporate customers in Austin.

Since the US chip manufacturing line was established in 1996, Samsung has invested $17 billion in the facility.

Samsung is said to have been mulling over the plan to construct an additional chip plant in the American market after US President Donald Trump visited South Korea in late June.

The rumored plan has gained more traction in the face of what is expected to become a long-term trade row between the Asian economic powers.

In 2017, the company announced it would invest $15 billion in the Austin manufacturing complex.

Samsung, however, denied the rumored plan, saying the additional investment plan had not yet been decided.

The rumor came after Japan recently strengthened regulations on the exports of chemical products essential to the production of chips and OLED displays to Korea. In addition, it is also trying to restrict exports to the branches of Korean chip and display companies in China.

Vice Chairman Lee Jae-yong, who visited Japan to meet with Japanese partners earlier this month, has reportedly ordered subordinates to come up with long-term measures to weather the current difficulties caused by Japan’s trade curbs.

SK hynix, the No. 2 DRAM chipmaker after Samsung, is also making all-out efforts to respond to the fallout of the ongoing trade conflict between Korea and Japan.

SK hynix top executives, including CEO Lee Seok-hee, have flown over to Japan to hold meetings with Japanese suppliers of the chemicals.

“SK hynix has also launched a contingency plan amid the escalating trade feud,” said a representative from the chip company, adding, “The firm is considering various solutions to cushion the impact of the restrictions.”

By Kim Young-won (wone0102@heraldcorp.com)

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