World’s Biggest IT Investment
Samsung Electronics and SK Hynix scaled down facility investment due to the sluggish DRAM market last year. This year, however, they will invest aggressively. Samsung Electronics is projected to spend US$12.5 billion (about 14.5 trillion won) in CAPEX, the biggest amount in the world semiconductor industry.
According to market researcher IC Insights on March 7, Samsung Electronics is expected to invest 11% more in facilities this year compared to last year. DRAM prices were low last year, but the semiconductor industry is recovering this year as a semiconductor super cycle is predicted. The Korean semiconductor giant invested US$11.3 billion last year, down 13% from a year earlier, and said that the ratio of memories to system LSIs was about 8 to 2.
Samsung's facility investment is expected to focus on Pyeongtaek in Gyeonggi-do, South Korea. The company is building the world's largest semiconductor complex there, and plans to roll out V-NAND flashes beginning in the middle of this year.
SK Hynix plans to spend US$6 billion (around 7 trillion won) this year which will be the world's fourth largest facility investment in the semiconductor industry. Last year, its investment volume sank 14 percent to US$5.18 billion (about 6.6 trillion won) from the previous year. SK Hynix plans to cut back on DRAM investment this year but increase investment to expand 3D NAND production. The increase in facility investment this year will be used for the construction of a clean room and related infrastructure at M14 of Icheon factory of Gyeonggi-do.
Intel, a dominant player in the system semiconductor market, is also expected to make aggressive facility investments. Its facility investment for this year is expected to hit US$12 billion (about 14 trillion won), the second highest after that of Samsung Electronics. Intel increased its investment year on year 31 percent in 2016 and will ramp it up 25 percent this year.
Moreover, Taiwan's TSMC, the world's largest semiconductor foundry, is expected to spend US$10 billion on facility investment, down two percent from the previous year, while Micron, the US, will fork out US$ 5 billion on facility investments.