High-bandwidth memory (HBM) leader SK hynix is set to build an advanced packaging facility in Indiana, which is estimated to cost $4 billion and come online in 2028 to potentially package high-end HBM.

It has been known for some time that SK hynix was interested in building a new facility in Indiana, but the company's board is finally ready to vote on it, according to the Wall Street Journal. The advanced packaging plant will be sited in West Lafayette, near Purdue University.

SK hynix will reportedly invest $4 billion into its Indiana plant, with additional financial support from state and federal tax benefits, and perhaps even a chunk of the $3 billion of CHIPS Act money set aside for US-based packaging facilities. The site may be ready for packaging as soon as 2028.

SK hynix had not immediately responded by the time of publication but we will update this story if it responds.

It's likely that SK hynix's Indiana facility will be used for HBM, one of the company's best-selling memory products. Packaging is a critical step in making processors, and packaging services can be quite lucrative thanks to high demand in the AI computing era. Upon completion (and assuming it is used for HBM packaging), the plant would be the first major HBM packaging facility in the US.

The plant won't be exclusively used for HBM, according to WSJ, which says "other types of advanced packaging" will also take place. However, it's not yet clear what these "other types" will be.

Even though SK hynix has been reaping the financial rewards of being the leading HBM manufacturer, its rivals can still profit from being part of the packaging process. Samsung is one of the biggest names in advanced packaging and also produces HBM, so naturally the company is one of SK hynix's biggest rivals. Building a new packaging facility will help SK hynix at the expense of Samsung, as well as TSMC, another leader in packaging technology and services.

While many products use HBM, one of the most important is Nvidia's Hopper and Blackwell GPUs. SK hynix has been an important supplier of HBM for Nvidia's AI-focused graphics cards, but TSMC is the company that handles the packaging step. SK hynix's Indiana facility may one day package Nvidia GPUs, should the ties between the two companies continue to be as close as they are today.

The Indiana plant would be part of the larger efforts to bolster the US's domestic semiconductor manufacturing, which so far aren't going too well. Delays have become commonplace, such as those for important materials at Intel's and TSMC's Arizona fabs, which are still being constructed.

Intel's fab in Ohio, which neighbors Indiana, was also recently delayed, but due to economic and financial factors. With the squeeze on the construction industry and supply chains at present, we wouldn't be surprised if upcoming projects suffer similar fate. ®

https://www.theregister.com//2024/03/26/sk_hynix_indiana_plant/