Samsung plans $1.5-billion chip testing plant in Vietnam, document shows

HANOI, Vietnam – Samsung Electronics plans to invest 39 trillion dong ($1.5 billion) in Vietnam to build a semiconductor testing plant, its proposal document showed, an expansion that will help ease a global shortage of memory chips driven by surging AI demand.

The new factory, for which construction has already begun in an industrial park 60 kilometers (37 miles) north of Hanoi, is slated to start operations in November 2027, the document sent to local authorities in April and reviewed by Reuters showed.

It would be Samsung’s first chip testing factory in Vietnam. Robust memory chip demand from AI data center operators has severely constrained supplies to industries such as smartphones, laptops and automobiles.

The factory would focus on legacy chips, the document showed. While less critical for AI supply chains, mature memory chips are also in severe shortage as major producers dedicate more of their production capacity to manufacturing AI chips.

The new plant would have annual capacity to deliver 153.3 billion gigabits (Gb) of dynamic random-access memory (DRAM) chips and another 255.6 billion Gb of NAND memory chips, according to the proposal which was sent to obtain environmental permits for the new site.

Details on the size of Samsung’s investment in the project, production capacity and production timeline have not been previously reported. Samsung declined to comment.

The People’s Committee of Thai Nguyen province, which hosts the industrial park, did not respond to a request for comment.

Major chip back-end hub

The investment was approved by Vietnamese authorities in March and Samsung intends to reinvest profits from the project, “if any”, up to about $2.5 billion, for a potential second factory, the document said.

It is not clear whether the factory has obtained all necessary permits or talks are still ongoing with the authorities. Companies in Vietnam often begin initial ground works on building sites while they await environmental permits.

More than 200 Samsung engineers and staff have been working on the site of the project at least since April, said a person briefed on the matter, who declined to be identified because the information is private.

Reuters reporters observed heavy construction vehicles and workers on the site during a visit this week. A security guard confirmed the site would host a Samsung semiconductor plant.

The South Korean group is already the largest foreign investor in Vietnam, having committed more than $23 billion over decades to multiple facilities. The new plant is being built next to a large complex where Samsung Electronics produces smartphones and tablets.

Vietnam is also a major player in the global semiconductor back-end industry, which is more labor-intensive and less sophisticated than chip fabrication. The country hosts assembling, packaging and testing plants of several multinationals, including Intel, Amkor Technology, and Hana Micron.

Testing is the final process in chipmaking, in which semiconductors previously assembled and packaged are checked for possible defects before shipment, the document showed. – Rappler.com