SK Hynix Breaks Ground on $3.87 Billion Indiana AI Memory Packaging Plant

$3.87 billion investment; operations to begin in 2028

SK Hynix has started construction of an advanced packaging production base for artificial intelligence memory in Indiana, establishing a key manufacturing foothold in the U.S. The move stands to strengthen the global AI chip alliance linking SK Hynix, Nvidia and Taiwan Semiconductor Manufacturing Co.

SK Hynix held a groundbreaking ceremony on Aug. 27 at Purdue University in West Lafayette, Indiana, for the new advanced packaging facility for AI memory. The event came two years and four months after the company announced the investment plan in April 2024. Chief Executive Officer Kwak Noh-jung, other company executives and U.S. government officials attended.

The plant will be SK Hynix's first production and research-and-development base in the U.S. The company is investing $3.87 billion in the project. The site covers 540,000 square meters, making it the largest single development project in Indiana history. Under an agreement signed with the Indiana Economic Development Corp. in June 2024, SK Hynix is eligible to receive subsidies of up to $712.18 million through 2055.

SK Hynix plans to begin mass production in the second half of 2028 of next-generation high-bandwidth memory, or HBM, and other advanced AI memory products at the site. Its plan is to ship wafers made at its plants in Icheon and Cheongju in South Korea to the U.S. for packaging, then deliver the finished products directly to major technology customers including Nvidia.

An industry official said the company chose the investment to reduce U.S. trade risks and expand market share. The Indiana base also allows SK Hynix to respond more proactively to pressure from the U.S. government for domestic investment while reducing the physical distance to TSMC's Arizona operations and local big-tech customers.

The project also offers advantages in infrastructure and access to skilled workers. Indiana has rapidly emerged as a "Silicon Heartland" in the U.S. Midwest after attracting research and development operations from Taiwan's MediaTek and IMEC, one of the world's largest semiconductor research institutes. SK Hynix also expects collaboration with Purdue University, known for semiconductor engineering, to help it secure core back-end technologies such as next-generation 3D packaging.

Kim Chae-yeon, Hankyung.com reporter why29@hankyung.com