Under Pressure from the Trump Administration, SK Hynix Looks for US Factory Site; Chey Tae-won: We Will Invest if Conditions Are Right!

SK Group Chairman Chey Tae-won has publicly stated that he is seeking locations for a storage chip manufacturing facility for SK Hynix on a global scale, with the U.S. among the options. This marks SK Hynix’s clearest official statement yet regarding the possibility of building a frontend wafer fab in the U.S., and has intensified the global competition for investment from the world's largest high-bandwidth memory (HBM) supplier.

In an interview with CNBC in New York on the 10th local time, Chey Tae-won said, “We are currently conducting due diligence not only in the U.S. but globally, looking for suitable locations. If we find the right place in the U.S., we will invest.” He also clarified the preconditions for building a plant in the U.S.: steady power supply, pure water sources, land, labor force, and a robust industrial ecosystem to support the supply chain are all indispensable. This statement came just one day after U.S. Secretary of Commerce Howard Lutnick put public pressure—at a Micron semiconductor event in Michigan, Lutnick explicitly called for Samsung Electronics and SK Hynix to establish production facilities in the U.S.

This declaration has led the market to closely monitor SK Hynix’s final investment direction. Meanwhile, SK Hynix has completed the largest-ever IPO in the U.S. by a foreign company, raising $26.5 billion with a market value surpassing $1.2 trillion—overtaking Micron and AMD. With supply shortages expected to last beyond 2030, the contest for this "golden goose" is heating up.

The U.S. government’s intent to expand domestic storage chip manufacturing capacity is now unequivocal. On the 9th, during the groundbreaking ceremony for Micron's new wafer fab in Clay, New York, Howard Lutnick stated, “Micron is leading the way; competitors will eventually have no choice but to follow.” That same day, Micron announced it would increase its U.S. investment to $250 billion by 2035 and plans to manufacture 40% of the world’s DRAM in the U.S.—this plan has already been revised upward twice.

Analysts believe the timing of Micron’s expansion announcement—just one day before SK Hynix’s Nasdaq IPO—is a strong signal targeting Korean firms competing with Micron in the HBM market. Under the Trump administration’s goal of producing 40% of the world’s semiconductors domestically, Samsung Electronics and SK Hynix are top priorities for the U.S.

Chey Tae-won subsequently expressed a conditionally open stance toward building a U.S. plant. In addition to the advanced packaging facility under construction in Indiana, he said further investments are being considered and directly stated that building a storage wafer fab in the U.S. is possible—if the conditions are right. Industry analysts believe that aside from financial and tax incentives, the U.S. government may leverage semiconductor tariffs as a bargaining chip to pressure global chipmakers.

Samsung Electronics and SK Hynix have not released official statements regarding Lutnick’s remarks, saying they have not yet received specific investment requirements from the U.S. government. However, industry insiders report that Samsung Chairman Lee Jae-yong, Samsung DS division head Jeon Young-hyun, SK Group Chairman Chey Tae-won, and SK Hynix CEO Kwak Noh-jung are all currently in the U.S., and the American position has likely been communicated directly or indirectly to them.

SK Hynix CEO Kwak Noh-jung told Bloomberg and Reuters on the day of the Nasdaq listing, “From a supply side, next year will be the toughest year in the industry’s history.” He also noted the memory shortage could extend beyond 2030, adding that customers are signing long-term supply contracts because they also anticipate this supply shortfall will persist for the long term.

According to Bloomberg, Kwak stated the global memory industry is heading toward the most severe supply shortage ever, with the peak expected in 2027.

Market research agency TrendForce data shows that in Q2 this year, generic DRAM and NAND flash prices rose 58%–63% and 55%–60% quarter-on-quarter, respectively; in Q3, prices are expected to rise further—DRAM by 13%–18%, NAND by 10%–15%. KB Securities research director Kim Dong-won expects the memory shortage in 2027 to be more severe than in 2026—KB Securities data shows DRAM and NAND demand growth will reach 17% and 19% respectively, while wafer capacity growth is forecast at just 7% and 4%.

Chey Tae-won also directly refuted concerns about cooling HBM demand. He stated, “There are simply no signs of HBM market contraction.” He further revealed that customers are not just doubling their HBM orders, they’re also doubling their conventional DRAM orders. According to Korean Economic Daily, some customers have even asked SK Hynix to expand supply five to six times its current level.

The feasibility pressure of building a U.S. plant largely stems from SK Hynix’s already-locked-in massive domestic investment plan.

Last month SK Hynix announced a domestic AI memory production belt centered around the Yongin Semiconductor Cluster, Cheongju, and Honam regions, with a total investment of 110 trillion Korean won—Yongin and Honam projects each receiving 60 trillion and 40 trillion won, respectively. Similarly, Samsung Electronics plans to invest 203 trillion won in the Pyeongtaek-Yongin cluster and 40 trillion won in Southwest Korea. Together, the two companies’ investments reach about 450 trillion Korean won (approx. $3 trillion USD).

In contrast, SK Hynix’s only substantial U.S. investment currently is in West Lafayette, Indiana—a $3.87 billion advanced packaging plant scheduled for operation in 2028, responsible for HBM and AI accelerator interconnect packaging. Should SK Hynix also establish a frontend wafer fab, its U.S. supply chain would extend from packaging to full-stack production, requiring tens of trillions of won in additional investment.

Industry sources underscore the real hurdles of building in the U.S.: high labor and construction costs compared to Korea, weaker ecosystems for materials, components, and equipment, and both cost and timeline for comparable factories are significantly higher than in Korea. Against this backdrop, the competition for allocating restricted investment capital between home and the U.S. will escalate. The Korean industry is urging the government for clearer tax breaks and subsidies to cope with U.S. pressure.

Beyond storage manufacturing, Chey Tae-won has also outlined a broader picture for SK Group’s AI industry investments in the U.S. During Nasdaq listing events, he said investment in AI, AI data centers, related technologies, and startups would “at least amount to several tens of billions of dollars,” and that SK is exploring various forms of AI joint ventures with partners, “expecting large-scale investments to materialize soon.”

Earlier this year, SK Hynix set up an AI Solutions Company (tentatively named “AI Company”) in the U.S.; according to Reuters, the company has also committed $10 billion for building its AI solutions business in the U.S.

Chey Tae-won also explained the strategic significance of this Nasdaq listing, believing U.S. listing will help the company attract top global talent through stock incentives and stating that with the influx of U.S. and global shareholders, the need for a new corporate governance structure is increasing.

In the first quarter of this year, SK Hynix led the global HBM market with a 58.1% market share, surpassing Samsung Electronics and Micron. According to The Wall Street Journal, its ADR closed on debut with a market cap of $1.2 trillion, and its Nasdaq IPO volume of $26.5 billion set a record for foreign offerings in the U.S. However, Bloomberg’s opinion columns also noted that capacity expansion does not necessarily translate into shareholder returns: the highly cyclical memory business can move from peak to trough in as little as two years, so investors should remain cautious.