Samsung Electronics Co. Ltd. and memory maker SK hynix Inc. will spend 622 trillion won, or about $471 billion, to establish a new chip hub in South Korea.

Bloomberg reported the plan today. Samsung is expected to provide about 80% of the capital earmarked for the project, or 500 trillion won, while SK hynix will contribute the rest. The companies intend to invest the funds through 2047.

The upcoming chip hub will reportedly be built on an area “spanning Pyeongtaek to Yongin,” two cities located about 18.5 miles apart. Pyeongtaek is already home to a multibillion-dollar Samsung fab (pictured) that makes memory chips. The facility hosts the world’s largest semiconductor production line, which takes up an area the size of about 16 football fields.

Samsung and SK hynix will build 13 new fabs at the planned chip hub. According to Bloomberg, the hub will be capable of producing 7.7 million silicon wafers’ worth of semiconductors per month by 2030, or 92.4 million annually. Taiwan Semiconductor Manufacturing Co., the world’s largest contract chipmaker, processed about 15 million wafers in 2022.

SK hynix will spend 122 trillion won to add memory production capacity in the city of Yongin. The company, which ranks as the world’s second largest memory maker behind Samsung, produces flash and DRAM chips as well as image sensors for cameras. Samsung’s investment, in turn, will reportedly prioritize its foundry business, which makes semiconductors based on customer-provided designs.

A sizable portion of the capital allocated to the new fabs is likely to be spent on manufacturing equipment. EUV systems, the machines used to etch transistors into silicon wafers, sell for upwards of $150 million a piece. The next generation of EUV equipment is expected to cost twice as much.

Alongside the 13 fabs Samsung and SK hynix intend to build, the planned chip campus will host three research facilities. The semiconductor industry is set to adopt several new manufacturing techniques in the coming years. The research facilities’ work may help streamline the implementation of those techniques in the 13 fabs expected to be built nearby.

One of the new technologies Samsung and other chipmakers are currently rolling out is a transistor design known as the gate-all-around, or GAA, architecture. Electrons travel between a transistor’s internal components via a structure called the channel. In a GAA transistor, the channel is surrounded by the gate, the component responsible for controlling electrons’ movement.

Besides implementing GAA in their production lines, Samsung and its rivals also plan to develop a three-dimensional version of the architecture down the road. This future version would make it possible to vertically stack transistors atop one another. It’s believed the technology could nearly double the number of transistors that can be placed on a processor, which should help increase performance. 

Three-dimensional GAA transistors are expected to roll out in seven to 10 years. That means some of the fabs Samsung and SK hynix plan to build by 2047 may potentially use the technology in their production lines.

Competing chipmakers are also investing heavily to expand their manufacturing capacity. Intel is building a set of new fabs in the U.S., the European Union and Israel at a cost of more than $75 billion. Micron Technology Inc. will spend up to $100 billion over 20-plus years to establish a new memory chip production facility in New York. 

Photo: Samsung