The company will produce silicon to cater for China’s growing domestic market
Samsung Electronics, the world’s largest maker of computer memory chips, is planning to expand its influence further by building a $7 billion (£4.4bn) semiconductor factory in China.
The new factory, announced yesterday, will be producing NAND flash memory. Countless devices including Apple’s iPhone and iPad use the NAND chips manufactured by Samsung.
Crispy chips and fresh silicon wafers
NAND flash is used in memory cards, USB flash drives, solid-state drives and similar products, for general storage and transfer of data. It is an essential component of modern smartphones and tablets.
The South Korean company will open its Chinese plant in Xi’an, Shannxi province, after an initial $2.3 billion (£1.4bn) investment. The total of £4.4 billion will be the largest amount of money Samsung has put into an overseas factory. It is expected to start operations next year.
The company said the plant will be able to produce 100,000 units of 12-inch wafer chips per month when run at its full capacity.
In a statement given to Bloomberg, Samsung called China the “key chip market”. The country’s economic growth over the last few years has seen income levels rise in the country, and it is expected to become the world’s largest market for consumer electronics in a few years.
Competing memory chipmakers are losing money after the prices for DRAM chips, another memory type used in computing, reached a record low. According to Gartner, NAND Flash memory is currently the fastest-growing segment in the semiconductor industry.
Samsung opened a new factory in South Korea last September. The £6.6 billion facility is the largest in the industry and can produce NAND flash chips as well as DRAM.
The company has another semiconductor plant in Austin, Texas, making both memory and logic chips.
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