South Korean semiconductor manufacturer SK Hynix is facing regulatory hurdles in its plans to establish new memory-chip manufacturing facilities in New York, as the US government has delayed approvals for equipment needed to expand the company’s production capacity in China.
The company is seeking US export licences to install American chipmaking equipment at its Dalian facility in China. SK Hynix has argued that expanding production at the plant would generate revenue to help finance its proposed investment in the United States.
However, the US Commerce Department has not yet approved the required licences, according to people familiar with the matter SK Hynix’s US subsidiary, Solidigm, is considering an investment of approximately $45 billion to build two NAND memory manufacturing plants in Marcy, New York. The investment could potentially increase to around $100 billion over time, although the company has not made a final decision on a specific location or plan.
NAND memory is used to store data even when power is switched off and is widely deployed in data centres and other computing systems.
The discussions between Solidigm executives and US government officials have continued, with the Commerce Department remaining cautious about approving equipment that could increase or upgrade semiconductor production capacity in China.
The negotiations also involve the US Treasury Department, which may need to consider waivers related to outbound investment restrictions. The Treasury is waiting for the Commerce Department’s decision before proceeding.
The proposed New York investment has attracted attention from local officials, who are hoping for progress before the federal investment tax credit expires at the end of 2026.
SK Hynix has maintained that filling existing cleanroom space at its Dalian facility would not increase the plant’s production capacity.
The situation highlights the challenge facing semiconductor companies as they navigate US efforts to attract manufacturing investment while maintaining restrictions on technology transfers to China. For SK Hynix, the approval process could influence the financing and timeline of its proposed US expansion.
