Samsung Electronics and SK Hynix on Alert
The U.S. government is about to announce details as to the CHIPS and Science Act. Samsung Electronics and SK Hynix, which are producing semiconductor products in China, are paying close attention as the act is to give more subsidies to semiconductor companies investing in the United States and ban facility expansion in China for 10 years.
At present, sales in China account for more than 30 percent of the combined semiconductor sales of Samsung Electronics and SK Hynix. Samsung Electronics’ NAND and packaging plants are located in Xi’an and Suzhou, respectively. SK Hynix has plants in Wuxi, Dalian and Chongqing. Depending on the details, those facilities can never be expanded for a decade to come.
The act was first announced in August last year and the two companies were given a grace period of one year in October last year. According to some experts, the grace period will remain effective in the guidelines and the companies’ future investment in China hinges on whether the grace period will be extended in October this year.