Invests over 4 Tril. Won in First Half
Samsung Electronics is on track to complete the expansion of its second plant in Xian, China by the end of 2021. The Korean semiconductor giant invested more than 4 trillion won in the first half of 2021 to install equipment before full-scale production in 2021.
Chinese government authorities said that Samsung Electronics invested 23 billion yuan (about 4.09 trillion won) in the Xian plant in the first half of 2021. This is about 108.5 percent of the investment planned for the period. Samsung Electronics invested 2 billion yuan more than planned.
The Xian plant is Samsung Electronics' only overseas NAND flash production base. The company decided to build the second plant in Xian in 2017 to respond to an increase in demand in the global memory semiconductor market. Since then, the company has been making investment in the plant with the goal of beginning operations in earnest in 2021. It announced US$7 billion investment in the plant in 2017 and additional US$8 billion investment in December 2019.
Samsung Electronics is reportedly considering expanding investment in the Xian plant as the global NAND flash market conditions are expected to improve. The company forecast in the second-quarter performance conference call that annual NAND flash demand bit growth will be in the 40 percent range, higher than the DRAM demand bit growth of the 20 percent range. Accordingly, Samsung is reportedly considering ramping up investment to around US$20 billion in the Xian plant from the originally planned US$15 billion.
When the second plant is completed by the end of 2021, its NAND flash output is expected to reach 130,000 sheets of wafer per month. If the first plant’s production capacity is added, Samsung’s output will reach 250,000 sheets of wafer per month. The company currently ranks first in the global NAND flash market with a 33 percent share.
Samsung Electronics invested 23.3 trillion won in facilities at home and abroad in the first half of 2021. In particular, its facility investment in the second quarter stood at 13.6 trillion won, the highest ever quarterly investment that exceeds the previous high of 13 trillion won in the fourth quarter of 2020.