Samsung Electronics and SK hynix are reviewing the possibility of investing in back-end semiconductor processes centered on the Gwangju–South Jeolla region. As the importance of advanced packaging grows with the expansion of the artificial intelligence (AI) semiconductor market, this is seen as a move to seek alternative bases to supplement the power and water limits of the capital area semiconductor cluster.
According to industry sources on the 10th, Samsung Electronics is reviewing a plan to build a new semiconductor packaging plant in the Gwangju area. Semiconductor packaging is a back-end process stage that completes the final product by stacking and connecting chips after wafer fabrication, and is cited as a key element of competitiveness for high-bandwidth memory (HBM) and AI Semiconductor.
Samsung Electronics currently operates packaging production lines centered on Onyang and Cheonan in South Chungcheong Province. If the Gwangju investment materializes, it would be the first additional domestic back-end production base secured since the Onyang campus was established in 1991. However, Samsung Electronics said, "Nothing has been confirmed yet."
SK hynix is also said to be reviewing the possibility of back-end investment in South Jeolla Province. However, the company has already begun construction of an advanced packaging plant (P&T7) in Cheongju, North Chungcheong Province, with an investment of about 19 trillion won. The industry sees discussion of securing additional production bases while maintaining the existing production system that connects the Yongin semiconductor cluster and the Cheongju packaging complex.
Infrastructure issues are behind the industry's focus on the Honam region. With the expansion of AI Semiconductor production, demand for power and water is surging, but the infrastructure capacity of capital-area semiconductor hubs such as Yongin and Pyeongtaek is increasingly constrained. By contrast, the Honam region is relatively advantageous for securing water and has a high share of renewable energy production, making it a candidate for long-term production bases.
The government's balanced development policy is also a factor. Recently, President Lee Jae-myung encouraged corporations to invest in the provinces and signaled an upcoming announcement of large-scale investment projects. In business circles, there is also speculation that some regional investment plans could be revealed at a meeting of major group chiefs scheduled for the end of this month.
However, industry sources noted the need to distinguish between back-end and front-end processes. Packaging faces relatively fewer location constraints, but the front end requires a supply chain ecosystem densely packed with hundreds of materials, parts, and equipment companies. Accordingly, analysis suggests it is highly likely that both Samsung Electronics and SK hynix will keep core production lines centered on existing capital-area clusters while reviewing a strategy of expanding regional investment focused on back-end processes.