Samsung and SK hynix are slowing down investments in South Korea after huge pledges to the USA

Samsung and SK hynix are reportedly reconsidering the construction of domestic semiconductor plants in South Korea after promising tens of billions of dollars into their operations in the United States.

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The US government has been shoveling billions of dollars to semiconductor companies, including TSMC, Samsung, SK hynix, Intel, NVIDIA, and others through its CHIPS Act. Now, South Korean companies are slowing down with domestic semiconductor operations.

Korea JoongAng Daily reports that Samsung is "reorganizing its investment plan from last year" and that "speed control should be inevitable".

Samsung has recently increased its investments to $44 billion from $17 billion for its new Taylor, Texas-based fab plants, which will see new manufacturing plants, advanced packaging facilities, and new R&D facilities from Samsung in Texas, USA. SK hynix recently announced $3.9 billion of investments for HBM memory chip manufacturing facilities in West Lafayette, Indiana. Still, SK hynix is expected to pump more money into its US operations through on-going talks with the US government and subsidies through the CHIPS Act.

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Samsung and SK hynix are involved with a South Korean government-led cluster project planned for Yongin, Gyeonggi, which will operate in 2027. Samsung has pledged an incredible 360 trillion won (around $266 billion USD), while SK hynix has pledged 120 trillion won (around $88 billion USD) towards the project.

One of the sources that Korea JoongAng Daily talked to said: "The chip industry is often called an art of timing because when to invest is so important with the industry upturn and downturn continuously repeating. Tens of trillions of won are at stake for that one investment decision, so companies don't have to strictly follow the preset schedule".