SK hynix’s US subsidiary, Solidigm plans to invest $45 billion for two NAND plants in Marcy, New York.
As US officials hold approval on chipmaking equipment for SK hynix’s plant in China, the company’s plans for a new memory chip plant in New York gets complicated. The US department of Commerce has yet not approved the licences for equipment for SK hynix’s Dalian facility. The increased production there, would have in turn funded the company’s US expansion.
SK hynix’s US subsidiary, Solidigm plans to invest $45 billion for two NAND plants in Marcy, New York. NAND memory is critical for data centres as it retains memory, even when the power is off. Solidigm’s planned investment in New York is expected to reach $100 billion. Executives from Solidigm have met Commerce department officials, almost ten times since August explaining that approvals for Dalian plant is central to SK hynix’s expansion in the US.
As the two sides are negotiating a separate license agreement for 2027 to keep up the equipment in the Dalian facility, Commerce Under Secretary Kessler, last week, held his position that the US doesn’t want to allow high-end American chip-making tools to help expand the capacity in China. The company has also drafted multiple versions of license applications since the meeting between Solidigm co-CEO Richard Chin and Commerce Secretary Howard Lutnick in August.
Officials in New York are looking forward eagerly to the investment. “Hopefully we’ll have an answer in the next couple of weeks,” said Anthony Picente, county executive for New York’s Oneida County, where the proposed facility would be located.
The company officials also met with the Treasury department, which would have to waive outbound restrictions on investments in China. SK hynix also explored to raise funds for its US facility through an initial public offering (IPO) but backtracked on those plans due to share price trends.
SK hynix acquired Intel’s Dalian NAND factory in 2020, before the US imposed sweeping restrictions on exports of chips and manufacturing equipment to China. The company said that installing equipment to fill empty space in the Dalian facility will not add to its capacity as the cleanroom was built in 2023. Hynix is certainly looking to produce more sophisticated NAND products in Dalian.
Initially the US waived the restrictions on foreign-owned chip-making facilities in China but last year the commerce department revoked the waiver on exports of US equipments to foreign companies in China and replaced the authorisation with annual licences that allow suppliers to ship certain equipment to facilities in China with quantity limits.
