SK Hynix is considering whether to build an advanced packaging plant in Indiana, the Wall Street Journal reported. If the company proceeds with the plan, it plans to invest US$4 billion to build one of the world’s largest advanced packaging facilities. But to complete the project, SK Hynix expects to need help from the U.S. government.
A company spokesperson acknowledged the report but did not confirm the company’s plans, telling the Wall Street Journal that SK Hynix “is reviewing its investments in advanced chip packaging in the United States but has not yet made a final decision.”
Companies such as TSMC and Intel have spent billions of dollars on advanced packaging facilities, but so far no company has announced a chip packaging plant worth as much as Shanghai Hynix’s $4 billion. The advanced packaging segment—CoWoS, passive silicon interposers, redistribution layers, die-to-die bonding and other cutting-edge technologies—has seen a surge in demand over the past five years. As the bandwidth advances of traditional organic packaging have largely been exhausted, chip designers need to turn to more complex (and difficult to assemble) technologies to connect more and more signals at higher and higher transmission rates. This makes advanced packaging a bottleneck for high-end chip and accelerator production, driving the need for additional packaging facilities.
If SK Hynix approves the project, the advanced packaging facility is expected to begin operations in 2028 and create up to 1,000 jobs. The plant is expected to cost $4 billion and is expected to become one of the largest advanced packaging plants in the world.
At the same time, government support is considered critical for an investment of this scale and could provide state and federal tax incentives, the report said. The incentives are part of a broader effort to support the U.S. semiconductor industry and reduce reliance on South Korea to produce memory.
SK Hynix is the world’s leading HBM memory manufacturer and one of NVIDIA’s main HBM suppliers. The next generation of HBM memories, including HBM4 and HBM4E, will require closer collaboration between chip designers, chipmakers and memory manufacturers. Therefore, packaging HBM in the United States could bring significant benefits to NVIDIA, AMD and other US chip manufacturers.
Investing in the Indiana plant will be a strategic move by SK Hynix to enhance its advanced chip packaging capabilities and demonstrate its dedication to the U.S. semiconductor industry.