SK Hynix reportedly wants Intel to make its memory chips in the US

According to a new report from Reuters, SK Hynix is now in talks with Intel about a potential deal that would see the Korean company manufacture memory chips in the US for the first time.

There are apparently two ways this can go: either SK Hynix will lease part of Intel's chip factory in Ohio, or it could form a joint venture with Intel as well as some unnamed "major cloud firms that are keen to lock in memory chip supplies".

This all comes from "people familiar with the matter", so nothing is confirmed or official yet. A deal with SK Hynix would help Intel get out of its current not very rosy situation. In fact, upon news of this coming out, both Intel’s and SK Hynix’s stocks went up. Intel announced its investment in the Ohio facility back in 2022, pledging up to $100 billion for it, but while production at the site was first scheduled to begin in 2025, it's now slipped to at least 2030.

There is a possible wrinkle here: whether the Korean government will allow this to happen. It is right now unclear what exact memory chips SK Hynix wants to make in the US, but if a possible agreement with Intel involves advanced memory like HBM or DRAM, the South Korean government may oppose it as "those technologies are considered sensitive".

In a statement to Reuters, SK Hynix said that it is "reviewing various measures, including establishing additional production bases, to strengthen the competitiveness of its memory business", while "no matters have been determined at this stage". The talks with Intel are classified by the aforementioned "people familiar with the matter" as "exploratory", which seems to fit with SK Hynix's response.

On the other hand, Intel declined to comment on the matter, simply stating that it's continuing with its investments in Ohio. South Korea's trade ministry said any decision would be at SK Hynix's "sole discretion", but if a deal would involve "national core technology", then it would be subject to a review under the country's Industrial Technology Protection Act.

Manufacturing semiconductors in the US is much more expensive than in Korea, but SK Hynix has recently been under increasing pressure from its customers as well as various governments to supply more chips amid the AI boom and global chip shortage. Back in July, SK Group chairman Chey Tae-won told reporters: "I think we need to build a factory in the United States. If possible, I believe we should build it".

Meanwhile, the Korean government has been urging SK Hynix to build a new cluster of chipmaking facilities in the country's southwest. Last month, the company announced a $38 billion investment in new DRAM and NAND fabs in Korea.

US Commerce Secretary Howard Lutnick has threatened to impose 100% tariffs on South Korean and Taiwanese companies unless they commit to increased chip production in the US, so a deal between SK Hynix and Intel could be a way to avoid that.

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