Top U.S. memory chip maker Micron Technology on Wednesday said it will invest $150 billion in chip manufacturing and research and development over the next decade as governments around the world vie to bring vital semiconductor production on shore.
Micron's biggest-ever expansion plan, which runs through 2030, comes as the U.S., Europe, Japan and China race to boost their domestic chip supply chains amid an unprecedented global chip shortage. The U.S. Senate earlier this year passed a $52 billion bill to support domestic semiconductor manufacturing and R&D, although the package is yet to become law.
"Memory is at the leading edge of semiconductor manufacturing and fuels everything from feature-rich 5G smartphones to the AI-enabled cloud," Micron President and CEO Sanjay Mehrotra said in a statement.
The U.S. chipmaker is looking forward to working "with governments around the world, including in the U.S.," the CEO said.
The company declined to comment on media reports that it was considering building an additional plant in Japan, saying in a statement to Nikkei Asia: "We're evaluating locations and engaged with governments in several countries around the world, and will provide updates as the process continues and at the appropriate time.... While we are evaluating many potential global sites for expansion, we have not finalized investments for any expansion at this time including those speculated in the media."
Micron also made it clear that financial support, including in the form of tax credits, will be a key factor in its decisions on where it will invest, saying manufacturing costs in the U.S. are 35-45% higher than in countries with established chip supply chains.
Micron has manufacturing footprints in the U.S., Taiwan, Japan and Singapore, and it operates chip packing facilities in China and Malaysia. The company's most important production base for dynamic random access memory is in Taiwan, while its most significant site for flash memory is in Singapore. Both DRAM and flash memory chips are essential to smartphones, data centers, computers, cars and myriad other items.
However, Micron's announcement comes just weeks after the U.S. chipmaker and its memory chipmaking peer Nanya Tech lowered their guidance for this quarter as persistent chip and component shortages force device makers to start scaling back production. The two also warned of likely order and price corrections due to a serious mismatch of component supplies in the tech supply chain.
Micron is the world's third-largest DRAM chipmaker after Samsung and SK Hynix. It is the world's fifth-largest flash memory chipmaker after Samsung, SK Hynix, Kioxia and Western Digital. The company did not specify how it would allocate investment between DRAM and NAND flash memories in its $150 billion expansion plan.
Just days before Micron's announcement, Taiwan Semiconductor Manufacturing Co., the world's largest contract chipmaker, said it will build its first-ever chip plant in Japan, as part of the Taiwanese company's global expansion strategy to respond to major economies' call for domestic chip production. TSMC also pledged to spend $100 billion through 2023 to help alleviate the global chip shortage. The Japanese government is expected to subsidize up to half of the estimated 1 trillion yen ($8.8 billion) cost of the Japan project.