SK Hynix’s $15 billion chip plant poised to go to Indiana over Arizona

The firm first announced the project in 2022 and originally intended to select a site within the first half of 2023. SK Hynix is slated to pick Indiana but still has Arizona as a second choice, according to people familiar with the matter who asked not to be named discussing confidential conversations. 

An SK Hynix spokesperson said that no final decision has been made, following a Financial Times report that the firm had selected Indiana. 

The project will be a significant step forward for advanced packaging in the U.S., which has become a bottleneck in Washington’s efforts to revitalize the domestic semiconductor industry. The U.S. has only 3% of the world’s packaging capacity, meaning that firms manufacturing chips in America have to ship them to Asia to be assembled for use.

Critical electronic components have become a battleground between Washington and Beijing, with the U.S. spending tens of billions of dollars to wean itself off Asian supply lines and bolster the domestic economy. Semiconductor firms have pledged to invest more than $230 billion on American soil since President Joe Biden took office, spurred by the 2022 Chips Act. 

Most of that investment has gone to Texas, New York and Arizona, which has alone won more than $60 billion in investments from Taiwan Semiconductor Manufacturing Co., Intel Corp., Amkor Technology Inc. and dozens of others. 

Indiana has a very modest footprint just north of $2 billion in recent investment. SK Hynix’s pending decision would be a boon to the state and the region, which secured a $20 billion Intel project in Ohio. 

It would also be a victory for Senator Todd Young, an Indiana Republican and an architect of the Chips Act….