Taiwanese DRAM company Nanya Technology is moving to add an advanced DRAM plant in southern Taiwan. With a supply shortage continuing for memory used in artificial intelligence (AI), the company reportedly began additional expansion after failing to meet customer demand even while running existing facilities at maximum capacity.
According to Taiwanese media including the United Daily News on the 14th, Formosa Plastics Group, Nanya's parent company, is reviewing construction of a 12-inch (300 mm) wafer plant at industrial parks in Yunlin and Pingtung in southwestern Taiwan as candidate sites. The facility would produce next-generation DRAM and customer-tailored DRAM.
Nanya is said to have been pursuing the construction of a new plant since the second half of last year. Local media said the company is operating its existing production capacity at maximum levels but still cannot keep up with growing memory demand.
The company initially reviewed building a plant in northern Taiwan, but as it became harder to secure land due to capacity expansions by TSMC, the world's largest foundry, it reportedly broadened potential sites to the south. Considering water and power supply and surrounding industrial infrastructure, the Yunlin industrial park is being mentioned as the leading candidate.
The new plant is expected to adopt Nanya's advanced sub-1d 10-nanometer-class DRAM process. The labels 1b, 1c, and 1d distinguish generations of 10-nanometer-class DRAM manufacturing technology, with letters further down the alphabet generally indicating newer generations.
Formosa Plastics Group Chairperson Wu Chia-chau said that while the final site has not yet been set, the investment size for the new plant will far exceed the roughly NT$300 billion (about 13.2 trillion won) for the "Fab 5A" currently under construction in northern Taiwan. Nanya is currently producing DRAM at a monthly volume of 70,000 wafers at two 12-inch wafer plants in the Taishan Nanlin Science Park in New Taipei, northern Taiwan.
The push for a new southern plant is separate from Nanya's ongoing Fab 5A investment. According to market research firm TrendForce, Nanya plans to invest a total of NT$346.6 billion (about 15 trillion won) in Fab 5A from 2026 to 2029. It is the largest investment in Nanya's history and is seen as the biggest single investment in Taiwan's DRAM industry in about 20 years.
Fab 5A will sequentially adopt 10-nanometer-class 1b, 1c, 1d, and 1e processes. It will also introduce extreme ultraviolet (EUV) lithography equipment. EUV uses short-wavelength light to draw fine circuits on wafers and is used to produce advanced DRAM. Nanya plans to start wafer production at Fab 5A in the second half of 2027, ramping up to 30,000 wafers per month in 2028 and 35,900 per month in 2029. Depending on market conditions, it is also pursuing expansion to as many as 45,000 wafers per month. This year's capital expenditure budget was also raised about 34% to NT$69.7 billion from NT$52 billion.
Nanya's July revenue was NT$43.87 billion (about 2 trillion won), up 719.6% from a year earlier and 49.3% from the prior month, marking an all-time monthly high. The rise in DDR4 prices is seen as having contributed to the improved results. Nanya's share in the global market is still in the 1% range.