Shulou(Shulou.com)11/24 Report--

Thanks to CTOnews.com netizens soft media users 1520111, soft media new friends 1933769, West window old clues delivery! CTOnews.com, Oct. 16 (Xinhua) Last Monday, South Korean companies such as Samsung Electronics and SK Hynix were granted indefinite exemptions from the US government for their Chinese factories to import US chip equipment without special permission.

This is undoubtedly good news for Samsung, and they are indeed taking steps after obtaining the exemption. Samsung Electronics executives have decided to upgrade their Xi'an NAND flash memory plant to 236-layer NAND process and have begun to expand on a large scale, Business Korea reported.

According to sources, Samsung has begun to purchase the latest semiconductor equipment, and the new equipment is expected to be delivered by the end of 2023, and devices capable of producing eighth-generation NAND will be introduced in Xi'an in 2024, which is also seen by the industry as a strategic step to overcome the decline in production capacity caused by weak global NAND demand.

According to public information, Samsung (China) Semiconductor Co., Ltd. settled in Xi'an High-tech Zone in 2012, and Samsung Semiconductor Xi'an factory is the company's only overseas memory semiconductor production base.

The plant added a second phase of the plant project in 2020 and has grown into the world's largest NAND manufacturing base, producing 200,000 12-inch wafers a month, accounting for more than 40 per cent of Samsung's total NAND production.

Samsung's first factory in Xi'an invested US $10.87 billion (CTOnews.com Note: currently about RMB 79.46 billion), and the second plant, which began construction in 2017, has invested US $15 billion (currently about RMB 109.65 billion).

Foreign media believe that Samsung decided to upgrade its Xi'an plant for two reasons. One is that there are no obvious signs of recovery in the global NAND market environment, in which case Samsung needs to maintain its global leadership in the NAND market; another reason is the indefinite exemption just issued by the United States.

Due to serious overcapacity and the severe downturn in demand in the global IT market since the end of last year, the weakness in the semiconductor market has seriously affected Samsung's NAND business, resulting in an increase in inventory levels and widening losses. Even if there is a slight improvement after a slight reduction in production through the production reduction policy, Samsung still needs to upgrade its process as soon as possible.

By upgrading the latest generation 8 NAND products, Samsung can not only ensure price competitiveness, but also better balance market supply and demand, considering that generation 8 NAND investment is about 30% lower than generation 6 wafer investment.

It is said that the Xi'an plant, the main production base of the sixth-generation (128layer) V-NAND, has also seen a sharp drop in operating rates since Samsung announced production cuts in April, and the overall operating rate has now fallen to about 20 per cent.

Foreign media believe that although the United States has temporarily relaxed restrictions on Chinese semiconductor equipment, this is only a temporary respite for Samsung and SK Hynix.

Related readings:

"South Korea: Samsung and SK Hynix China factories obtain indefinite permission from the United States to obtain chip manufacturing equipment without separate approval."

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