South Korea’s memory giant looks across Japan for chip-manufacturing sites with reliable power and water to ease global artificial intelligence supply bottlenecks.
South Korean memory chipmaker SK Hynix is assessing potential sites across Japan to establish a joint-venture semiconductor fabrication plant, aiming to ramp up production of NAND flash and memory chips driven by the global artificial intelligence (AI) boom.
Speaking on the sidelines of a South Korea–Japan business conference in Sendai, SK Group chairman Chey Tae-won confirmed that the company is evaluating locations across Japan, prioritising regions with reliable power and water infrastructure. The potential project could mark the first major semiconductor manufacturing facility built in Japan by a South Korean firm.
The search comes as explosive demand for AI servers and data storage places unprecedented strain on global memory output. While SK Hynix dominates the market for High Bandwidth Memory (HBM) used in AI processors, the rapid expansion of AI workloads has also created severe shortages in high-capacity NAND flash and enterprise solid-state drives. Chief executive Kwak Noh-jung recently warned that memory supply deficits could persist well into 2030.
The structure of the potential expansion remains flexible, ranging from co-investments and joint ventures to targeted acquisitions of local firms. Industry observers speculate that Japanese flash-memory producer Kioxia Holdings could be a potential partner. SK Hynix already holds an indirect stake in Kioxia via a Bain Capital-led consortium, and Kwak recently noted the company is actively exploring ways to co-develop the NAND market with industry partners.
Hynix has 22 per cent flash market share, Kioxia has 14 per cent stake, and its manufacturing partner SanDisk has 11 per cent share.
The feasibility review in Japan forms part of a broader global expansion strategy by SK Hynix. The company has already committed 54 trillion South Korean won (US$39 billion) to expand domestic manufacturing bases in South Korea and broke ground on a US$4 billion advanced packaging facility in Indiana, United States.
Establishing a manufacturing footprint in Japan would allow SK Hynix to further diversify its supply chain, tap into Japan’s deep ecosystem of chipmaking equipment and material suppliers, and potentially leverage generous subsidies offered by the Japanese government to bolster its domestic semiconductor sector.
