SK Hynix reportedly in talks with Intel about deal to make memory chips in US for the first time

SK Hynix is reportedly in discussions with Intel regarding a deal that would see the South Korean company manufacture memory chips in the United States for the first time, according to three individuals familiar with the matter. One potential scenario could involve SK Hynix leasing part of Intel's planned chipmaking facility in Ohio, while another scenario entails forming a joint venture with Intel and major cloud firms seeking to secure memory chip supplies.

Such a deal could alleviate pressure on Intel, which has been facing financial difficulties, and would be a significant victory for the Trump administration's efforts to encourage domestic chip production amid a shortage caused by increased demand for AI and data centers.

However, opposition from South Korea could pose a substantial obstacle, as the talks are currently described as exploratory and no decisions have been finalized. SK Hynix's product range includes DRAM chips for servers, PCs, and smartphones, as well as NAND flash memory and high-bandwidth memory used in AI processing units. The South Korean government may oppose the deal due to concerns over the sensitive nature of these technologies.

SK Hynix stated that it is reviewing various measures, including establishing additional production bases, to bolster its memory business, but no decisions have been made at this point.

Intel declined to comment on the speculation, but confirmed that it is continuing with investments in Ohio to prepare the site. The South Korean Trade Ministry stated that any decision regarding the matter would be at SK Hynix's discretion, with the Industrial Technology Protection Act potentially coming into play if the deal involves national core technology.

The US Commerce Department did not respond to a request for comment. Building semiconductors in the US is significantly more expensive than in South Korea due to higher labor and construction costs, and the semiconductor supply chain is mainly located in Asia, amplifying expenses, according to two sources. Despite this, SK Hynix, which recently completed a Nasdaq listing in July and currently has a chip packaging facility under construction in Indiana, has reasons to pursue chip fabrication in the US.

SK Hynix's chairman, Chey Tae-won, previously expressed the company's need to build a factory in the United States to meet mounting customer and international demands.