SK Hynix Starts Construction of $4 Billion Memory Hub in Indiana

SK Hynix Inc. held a groundbreaking ceremony Thursday for its advanced memory packaging facility in Indiana, marking a milestone in Washington’s expansive campaign to rebuild domestic supply chains and manufacturing for strategically important sectors.

The West Lafayette plant, costing more than $4 billion and occupying a 133.5-acre site, will be SK Hynix’s first high-bandwidth memory packaging base in the US. Its cleanroom is expected to open by October 2028, with mass production of next-generation HBM scheduled to begin in the second half of 2029, Chief Executive Officer Kwak Noh-Jung said at the event. When fully operational, it’ll be a major HBM hub employing about 1,000 people, he said.

High-bandwidth memory is an indispensable part of the global artificial intelligence hardware boom, as it’s prerequisite for assembling Nvidia Corp.’s most advanced AI acceleration systems. That’s helped SK Hynix grow to become South Korea’s second most valuable company, right behind Samsung Electronics Co., which has also been lifted by runaway demand for HBM and other memory products.

The Indiana project is backed by the US Chips and Science Act, a signature law signed by President Joe Biden in 2022 that allowed for the Korean chipmaker to receive as much as $458 million in direct funding and up to $500 million in loans. The program was designed to reduce US dependence on overseas semiconductor production and bring critical chip manufacturing, packaging and research capabilities to American soil.

At the event, Kwak said the plant would help strengthen a domestic AI chip supply chain in the US that Washington views as essential to economic and national security. “We will expand our investments and collaboration in the US, grow together, and become the most trusted partner in shaping the future of AI in America,” he said.

The Indiana investment is particularly significant because it targets a weak link in the US semiconductor supply chain: advanced packaging. The technology combines multiple chips into a single package, often stacking them vertically to boost performance, as conventional tech miniaturization approaches become increasingly difficult.

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Wafers produced by SK Hynix in South Korea will be shipped to Indiana for packaging and testing before being supplied to US customers, the company said. The project is expected to create about 7,000 direct and indirect jobs through construction, operations and related industries. SK Hynix is currently considering more than 100 companies to supply materials, components and equipment, potentially creating a broader semiconductor cluster.

SK Hynix also signed an agreement with nearby Purdue University to cooperate on HBM, system integration and advanced packaging research. An advanced packaging R&D test bed will be built alongside the production lines. Reflecting Indiana’s historic ties with South Korea — the state sent about 140,000 troops to the Korean War — parent SK Group also said it would provide new employment and career opportunities for former US Forces Korea service members.