SK Hynix to Build AI Chip Facility with $950 Million in US Grants
The United States has granted grants and loans totalling $950 million to SK Hynix, a well-known semiconductor company in South Korea, for the construction of a new AI chip packaging facility. High-bandwidth memory (HBM) chip packaging is the main focus of this $3.87 billion facility, which is essential for AI chip manufacturers like Nvidia Corp. The market leader in this space, SK Hynix, intends to transport its memory chips from South Korea to the US location.
The Creation of Jobs and Their Economic Impact
It is anticipated that the new plant will provide about 1,000 vacancies, boosting the local economy. Like other businesses growing within the US, SK Hynix will also receive a 25% tax credit in addition to financial support in the form of grants and loans.
Targeted Development
Image Source: cryptotimes.io
Samsung Electronics and Micron Technology’s Sk Hynix want to supply more HBM chips to some of their key customers, including Nvidia, to stay competitive against rivals. This deliberate approach has increased the market capitalization of SK Hynix by half of the 2022 conclusion. The packaging procedure, which includes the process of covering the fleas and preparing them for integration in gadgets, plays an important role In current competition technology with the participation of China and America. Support based on the Science & CHIPS method
The 15th preliminary contract related to the 2022 Chips Scientific Law is marked by this subsidy.
The act restored the American semiconductor sector, which had lost a significant portion of its output to other countries in previous decades, by providing $39 billion in grants, $75 billion in loans and guarantees, and 25% tax credits.
Worldwide Semiconductor Approach
The Biden administration has now provided subsidies to SK Hynix, Samsung, Micron, Intel Corp., and Taiwan Semiconductor Manufacturing Co. (TSMC), the top five chip makers in the world, with this most recent revelation. On the other hand, at most two of these top companies have made investments in other nations that have funding schemes for semiconductors.
Large Clientele and Upcoming Projects
Apart from Nvidia, SK Hynix’s principal clientele also includes tech behemoths Apple Inc., Microsoft Corp., and Alphabet Inc. Up to $15 billion has been pledged by SK Group to research and packaging initiatives in the US. This agreement includes the Indiana factory, however the corporation had also looked at Arizona as a possible location. Arizona is also home to a new office for packaging company Amkor Technology Inc. as well as a substantial amount of money from Intel and TSMC.
In conclusion, SK Hynix has made significant progress towards increasing its market share in the AI chip industry thanks to the $950 million commitment from the U.S. government. In addition to strengthening the company’s market position, the expenditure will also contribute to the company’s main goal of revitalizing the U.S. semiconductor industry.
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