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SK Chairman: Semiconductor Market's Structural Shift Driven by AI, Cycles Are Different
🇰🇷 South Korea /Technology

SK Chairman: Semiconductor Market's Structural Shift Driven by AI, Cycles Are Different

From Dong-A Ilbo · () Korean

Translated from Korean, summarized and contextualized by DistantNews.

At a glance

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  • SK Group Chairman Chey Tae-won stated the semiconductor market is undergoing structural changes, moving beyond traditional boom-and-bust cycles.
  • He cited the AI revolution as a key factor driving demand far beyond current supply capabilities.
  • SK Hynix is considering new factory construction globally, provided suitable locations with necessary resources like power and water are available.

The semiconductor market is no longer moving in predictable cycles, according to SK Group Chairman Chey Tae-won. He asserted that the ongoing artificial intelligence revolution has fundamentally altered the industry's dynamics, creating a demand that significantly outstrips supply.

Structural changes have occurred. It is certain that it is not moving in the same cycle as before.

— Chey Tae-wonDescribing the fundamental shift in the semiconductor market dynamics.

"Structural changes have occurred. It is certain that it is not moving in the same cycle as before," Chey said during a press conference in New York on June 10. He explained that while cycles haven't disappeared entirely, the gap between demand and supply is currently immense. The speed of demand increase is far surpassing the pace at which supply can be expanded.

Chey highlighted the considerable lead times and numerous constraints involved in increasing semiconductor production capacity. "There are many constraints, and we cannot build factories just anywhere," he noted. This comes as SK Hynix, alongside Samsung Electronics, recently announced plans to invest 800 trillion won in new fabrication plants. The company is open to building facilities globally, including in the United States, if suitable conditions are met.

There are many constraints, and we cannot build factories just anywhere.

— Chey Tae-wonExplaining the challenges in expanding semiconductor production capacity.

"If there is a place that meets the conditions such as power, water, and a large site, we can consider it anywhere in the world, including the United States," Chey stated. He dismissed concerns about potential divergence between SK Hynix's U.S. and domestic stock prices, attributing such differences to market characteristics and investor preferences, which he believes are temporary. The company views its U.S. listing as an opportunity to enhance global market access and attract future investment.

If there is a place that meets the conditions such as power, water, and a large site, we can consider it anywhere in the world, including the United States.

— Chey Tae-wonDiscussing potential locations for new semiconductor fabrication plants.
DistantNews Editorial

Originally published by Dong-A Ilbo in Korean. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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