SK Hynix Secures $458 Million CHIPS Act Grant for AI Memory Packaging Facility in Indiana

SK Hynix lands US$458 million CHIPS Act grant

The US Department of Commerce has awarded SK Hynix a grant of up to US$458 million under the CHIPS and Science Act (CHIPS Act), supporting the company's efforts to strengthen the AI supply chain in the US. The funding will support the establishment of a research center in Indiana focused on next-generation high bandwidth memory (HBM) and advanced packaging R&D. The grant will contribute to SK Hynix's planned investment of approximately US$3.87 billion in Lafayette, Indiana, where the company will construct an AI memory packaging factory alongside advanced packaging manufacturing and R&D facilities. These developments aim to address significant gaps in the US semiconductor supply chain. The Commerce Department will release the funding incrementally as SK Hynix achieves specific project milestones. This strategic investment marks a crucial step towards enhancing supply chain security in the US. With AI applications driving unprecedented demand for HBM, the technology has emerged as one of the core bottlenecks in the AI industry supply chain. The new facility will enable domestic HBM production, creating approximately 1,000 new jobs at the facility, with hundreds more positions generated through construction-related opportunities. In a parallel development, SK Hynix will partner with Purdue University to establish a research center in Indiana, integrating the development, production, and packaging of next-generation HBM technology as a vital component of the US semiconductor ecosystem. Additionally, the US government has committed to providing SK Hynix with loans of up to US$500 million, as part of the authorized US$75 billion loan program under the CHIPS Act.

SK Hynix receives $458 million grant for AI chip plant in Indiana By Investing.com

Investing.com -- The U.S. Commerce Department has confirmed the allocation of up to $458 million in government grants to SK Hynix. This funding aims to support the creation of an advanced chip packaging plant and a research and development facility for artificial intelligence products in Indiana. SK Hynix, a supplier for Nvidia (NASDAQ:NVDA), announced in April their plans to invest $3.87 billion to construct the West Lafayette facility. The facility will feature an assembly line dedicated to mass-producing next-generation high bandwidth memory chips. In addition to the grant, the Commerce Department intends to provide $500 million in government loans for the SK Hynix project. The distribution of these grant funds will be contingent upon SK Hynix achieving project milestones. The department anticipates that the project will create 1,000 jobs and address a crucial gap in the U.S. semiconductor supply chain. Kwak Noh-Jung, CEO of SK Hynix, the world's second-largest memory chip maker, expressed the company's eagerness to contribute to strengthening the U.S. AI semiconductor supply chain. In August 2022, the U.S. Congress approved a $39 billion subsidy program for U.S. semiconductor manufacturing and related components. They also authorized $75 billion in government lending. The Commerce Department is distributing significant grants to the top five semiconductor manufacturers, including TSMC, Intel (NASDAQ:INTC), Samsung (LON:0593xq) Electronics (KS:005930), Micron (NASDAQ:MU), and SK Hynix. The department has finalized all of these grants, with the exception of the $6.4 billion award for Samsung.

US finalizes $458 mil. award to SK hynix for chips packaging facility

The logo of SK hynix / Reuters-Yonhap The U.S. Commerce Department on Thursday finalized an award to SK hynix of up to $458 million in government grants to help fund an advanced chip packaging plant and research and development facility for artificial intelligence products in Indiana. In April, the Nvidia supplier said it would invest $3.87 billion to build the West Lafayette facility which will include an assembly line to mass produce next-generation high bandwidth memory chips. The chips are used in graphic processing units that train artificial intelligence systems. The department also plans to make available $500 million in government loans for the SK hynix project. The grant funds would be distributed when SK hynix meets project milestones. The project will create 1,000 jobs and fill a key gap in the U.S. semiconductor supply chain, the department said. Kwak Noh-Jung, CEO of the world's second-largest memory chip maker, said in a statement the company looks forward to working "to build a robust and resilient AI semiconductor supply chain in the U.S." Congress in August 2022 approved a $39 billion subsidy program for U.S. semiconductor manufacturing and related components along with $75 billion in government lending authority. The Commerce Department is awarding major grants to all five leading semiconductor manufacturers -- TSMC, Intel, Samsung Electronics, Micron and SK hynix. The department has now finalized all of those but the $6.4 billion Samsung award. This month it finalized a $75 million award to Absolics for constructing a facility in Georgia to supply advanced materials to the country's semiconductor industry. Absolics is an affiliate of SKC, which in turn is part of Korea's second-largest conglomerate SK Group, as is SK hynix. (Reuters)

SK hynix to get $458 mn funding for US chip facilities

President Joe Biden's administration has finalized an award of up to $458 million for SK hynix, officials said Thursday, furthering efforts to lock in his legacy in boosting US semiconductor production before Donald Trump takes office. The money supports a broader SK hynix investment of around $3.9 billion in Indiana, where the South Korean semiconductor firm is building facilities including a memory packaging plant for artificial intelligence products, said the Commerce Department. US Commerce Secretary Gina Raimondo said "we are solidifying America's AI hardware supply chain" with the move. SK hynix is the world's second-biggest maker of memory chips. "This new facility will develop state-of-the-art advanced packaging, which is more and more important to US semiconductor leadership," said Arati Prabhakar, assistant to the US president for science and technology. The investment is expected to create some 1,000 new facility jobs, and there will also be a research hub set up via SK hynix's partnership with Purdue University, the Commerce Department added. Besides the direct funding of up to $458 million, the United States is also providing up to $500 million in loans to the company, through a loan authority under the CHIPS and Science Act. The Biden administration has unveiled billions in grants through the CHIPS Act, and officials have been working to get deals across the finish line in recent weeks -- before the new US administration enters the White House. President-elect Trump has previously criticized the CHIPS Act, which the grant falls under. But a finalized award means that funds can start flowing as companies reach milestones. Of more than $36 billion in proposed funding allocated, officials have finalized $26 billion so far. Other companies whose agreements have also been firmed up in recent days include Taiwanese chip giant TSMC, GlobalFoundries, Intel and Micron Technology. The United States makes some 10 percent of the world's chips, with none being the most advanced, and Washington has been working to shore up the country's chipmaking capabilities.

US Department of Commerce finalizes $458 million grant for SK Hynix to build Indiana packaging plant -- plans to lend an additional $500 million for Lafayette project

SK Hynix gets about half a billion dollars in direct federal grants from the CHIPS Act to build its Indiana factory. The U.S. Department of Commerce said it awarded SK Hynix $458 million in direct funding for its West Lafayette, Indiana, project to build a $3.87-billion packaging plant and R&D facility. The agency says this site is intended for artificial intelligence products and will fill "a critical gap in the U.S. semiconductor supply chain." Aside from that, it will also offer up to $500 million in loans to the company -- all of which are coming from the funding provided by the CHIPS Act. When completed, this project will allow HBM chips to be manufactured within the United States, which is crucial for making AI chips. With TSMC already operating as an Arizona fab (and getting better yields than comparable facilities in Taiwan), the U.S. could build most of the components of its most advanced chips within its borders. In addition, it's expected to create a thousand new jobs in the State of Indiana and even push research and development forward with its partnership with nearby Purdue University. "By investing in companies like SK hynix and communities like West Lafayette, the bipartisan CHIPS and Science Act continues to supercharge America's global technology leadership," says Commerce Secretary Gina Raimondo. "With this investment in SK hynix - the world's leading producer of high-bandwidth memory chips - and their partnership with Purdue University, we are solidifying America's AI hardware supply chain in a way no other country on Earth can match, creating hundreds of jobs in Indiana, and ensuring the Hoosier State plays an important role in advancing U.S. economic and national security," stated Raimondo. Many companies are racing to get funding from the CHIPS Act as Biden prepares to leave the White House. While there has been no official pronouncement yet on the fate of this massive investment in American semiconductor manufacturing, there have been rumors that Trump wants to end this program. On the other hand, some experts say that Trump will likely continue the program and even relax some of the more progressive requirements that the Democrats have included in the law. Whatever the case, many companies want to secure their grants as early as possible to avoid any uncertainties. As for the future of this federal investment program, we'll have to wait and see what President Trump does after January 20.

SK hynix Wins Close To Half A Billion Dollars Of US Funding For New AI Chip Plant In Indiana

This is not investment advice. The author has no position in any of the stocks mentioned. Wccftech.com has a disclosure and ethics policy. Korean memory manufacturer SK hynix won $458 million in funding through the CHIPS Act earlier today to build a memory packaging facility in Indiana. Semiconductor packaging has emerged as a key bottleneck for production, particularly in US-based chip production. SK hynix's new plant will focus on memory packaging, and along with the $458 million in direct funding, the firm will also be able to rely on $500 million in additional loans for the new sites. SK hynix HBM Memory Facility In Indiana Expected To Commence Production In 2028 Along with Micron, whose shares have tanked by 18% today after yesterday's earnings, SK hynix is one of the few firms in the world capable of making high bandwidth memory (HBM) chips for AI products. The market for HBM3e memory products has grown competitive, with reports claiming that Samsung is struggling with quality control. Micron and SK hynix have deepened their ties with NVIDIA. SK hynix and Samsung are the only two major Korean memory manufacturers. Hynix secured a preliminary win of a $458 million grant from the Commerce Department under the CHIPS Act in August. The grant covered an advanced HBM packaging facility and a research and development facility as part of the firm's $3.87 billion investment in the US. The deal with SK hynix meant that it joined TSMC, Micron, Intel and Samsung to ensure that all of the world's major semiconductor fabrication companies had a presence in the US. SK hynix's new facilities set up under this grant will create roughly 1,000 direct jobs and generate activity in the construction industry. They will focus primarily on memory packaging, commonly referred to as a 'back-end' process in the industry. Like TSMC, all of SK hynix's chip fabrication facilities are located in Asia. In South Korea, three sites are in Icheon; another fourth facility is in Chongqing, China. Along with these, the firm also operates research and development offices in San Diego, Poland and Taiwan. Once it starts production, which is currently planned for 2028, SK hynix's Indiana facility will be the first of its kind in the US. Given the critical role played by HBM memory in AI chips, the deal should prevent major disruption to America's AI chip supply chain. While SK hynix does not manufacture memory chips in America, Micron is investing $15 billion in Boise, Idaho, to produce the latest memory chips. All of Micron's leading-edge production facilities are located outside the US, and the firm has invested $100 billion in New York and Idaho as part of the largest semiconductor investment in US history. The firm received $6.2 billion in CHIPS funding in December for the Idaho facility which aims to grow America's share of advanced memory manufacturing to 10% by 2035. SK Hynix will also step up its memory packaging efforts in 2024. Reports have speculated that the firm aims to invest as much as $1 billion in its South Korean packaging facilities.

SK hynix to get USD458M funding for US chip facilities

WASHINGTON (AFP) - United States (US) President Joe Biden's administration has finalised an award of up to USD458 million for SK hynix, officials said yesterday, furthering efforts to lock in his legacy in boosting US semiconductor production before Donald Trump takes office. The money supports a broader SK hynix investment of around USD3.9 billion in Indiana, where the South Korean semiconductor firm is building facilities including a memory packaging plant for artificial intelligence (AI) products, said the Commerce Department. US Commerce Secretary Gina Raimondo said "we are solidifying America's AI hardware supply chain" with the move. SK hynix is the world's second-biggest maker of memory chips. "This new facility will develop state-of-the-art advanced packaging, which is more and more important to US semiconductor leadership," said assistant to the US president for science and technology Arati Prabhakar. The investment is expected to create some 1,000 new facility jobs, and there will also be a research hub set up via SK hynix's partnership with Purdue University, the Commerce Department added. Besides the direct funding of up to USD458 million, the US also providing up to USD500 million in loans to the company, through a loan authority under the CHIPS and Science Act. The Biden administration has unveiled billions in grants through the CHIPS Act, and officials have been working to get deals across the finish line in recent weeks - before the new US administration enters the White House. President-elect Trump has previously criticised the CHIPS Act, which the grant falls under. But a finalised award means that funds can start flowing as companies reach milestones. Of more than USD36 billion in proposed funding allocated, officials have finalised USD26 billion so far. Other companies whose agreements have also been firmed up in recent days include chip giant TSMC, GlobalFoundries, Intel and Micron Technology. The US makes some 10 per cent of the world's chips, with none being the most advanced, and Washington has been working to shore up the country's chipmaking capabilities.