Samsung Appliance Workers to Stage Rally Protesting Chip Workers' Wage Deal

SK Hynix announced a massive 100 trillion won ($64.38 billion) investment to build new chip plants in Cheongju, South Korea, including a facility for NAND flash memory. This initiative is part of a larger $2.1 trillion plan, jointly developed with rival Samsung Electronics, aimed at expanding chip production capacity and distributing the economic benefits of the AI boom beyond the Seoul metropolitan area.

The ambitious projects, detailed on Thursday, include a new NAND memory chip factory set to be completed by 2029 and a chip packaging plant by late 2027 in Cheongju. South Korea hopes these investments will double its memory chip production capacity within five years, positioning the nation as a global leader in memory chip manufacturing alongside US rival Micron.

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While demand for NAND has been increasing and is expected to continue growing in the future, NAND supply is constrained.

However, the significant capital injection has drawn caution from some investors. Michael Burry, known for his successful bets against the U.S. housing market, expressed concerns in a newsletter about the long-term returns on such massive investments in AI, particularly if AI spending cools. He suggested these large-scale investments could signal a potential downturn, stating, "I see that as the beginning of the end."

Despite external caution, SK Hynix CEO Kwak Noh-jung remains confident in the sustained demand for chips driven by AI. He noted that while NAND supply is currently constrained, demand is expected to continue growing. The company plans to commence construction of its new Cheongju NAND factory, dubbed M17, next year, following groundbreaking on another advanced packaging facility for AI memory in April.

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I see that as the beginning of the end.