SK Hynix is in talks with Intel over a potential deal to manufacture memory chips in the United States for the first time, a development that could draw attention to INTC stock as the company explores new opportunities in semiconductor manufacturing.
According to three people familiar with the discussions, the talks come as demand for memory chips continues to rise because of artificial intelligence and data center expansion.
Potential Ohio Manufacturing Deal
One option under discussion would involve SK Hynix leasing part of Intel’s planned chipmaking facility in Ohio, according to the sources. Another possibility is a joint venture involving Intel and major cloud companies that want to secure reliable supplies of memory chips.
The discussions are still exploratory, and no final agreement has been reached. SK Hynix said it is reviewing various options, including additional production bases, but confirmed that no specific decision has been made. Intel declined to comment on what it described as speculation while saying it continues to invest in its Ohio site.
Memory Demand Drives Expansion
SK Hynix produces several types of memory, including DRAM for servers, computers and smartphones, as well as NAND flash used for storage. The company is also a major supplier of high-bandwidth memory, or HBM, which is increasingly important for AI processors.
The exact type of memory that could eventually be produced in Ohio has not been determined. Any plan involving advanced memory technologies could also receive scrutiny from South Korean authorities because some technologies are considered sensitive under the country’s industrial technology protection rules.
Higher US Production Costs
Manufacturing semiconductors in the United States can be significantly more expensive than production in South Korea. Higher labor and construction costs, along with the concentration of much of the semiconductor supply chain in Asia, could increase expenses for a US operation.
Despite those challenges, expanding production in the United States could help SK Hynix establish a larger local manufacturing presence. The company already has a semiconductor packaging facility under construction in Indiana, giving it an existing U.S. investment as it considers additional production options.
For Intel, a partnership could provide another potential use for its planned Ohio manufacturing capacity. However, the SK Hynix discussions remain preliminary, and the structure, technology involved and timing of any possible agreement have yet to be finalized.
Source : reuters.com
