Defying global recession, Samsung announces 3nm chip production ramp-up

Samsung is making preparations to ramp up production of 3nm chips at its largest semiconductor fab in South Korea, with high-tech equipment already ordered from Dutch supplier ASML.

According to revelations in the South Korean press, Samsung will add at least 10 new EUV (Extreme Ultraviolet) lithography-based equipment at its largest semiconductor fab in the Pyeongtaek industrial region. Named P3 and run with a staff of 60,000 employees, the new factory became operational in July this year and specialises in high-tech chips with 5nm, 4nm and 3nm manufacturing process.

The newly installed EUV equipment at this location uses 12-inch wafers and will deliver both logic chips (e.g. smartphone chipsets) as well as DRAM and V-NAND memory solutions.

By investing heavily in adding production capacity for the most advanced manufacturing technologies, even as other industry players are scaling back, Samsung hopes to consolidate a much-favoured position for an eventual market rebound, as happened in the immediate aftermath of the COVID pandemic. In addition, Samsung needs all the trump cards it can get against main rival TSMC, with which it shares a 15.5% vs 56.1% market share.

At least in the memory chip segment. TSMC has already announced a 10% reduction in annual semiconductor investment for the current year. Memory chip maker Micron Technology recently announced it will invest only about $7.5 billion in fiscal 2023, down from $12 billion this year. This reduction in investment may continue into 2024, depending on market conditions.

Samsung, on the other hand, has said it has no plans to cut chip production, let alone reduce investment. “We plan to stand behind our initial infrastructure investment plans,” Han Jin-man, the company’s executive vice president for the memory business, said in October.