Micron plans new memory chip factory in US as it ramps up spending

Micron has pilot manufacturing lines for the development of new technologies at its headquarters in Idaho and a plant in Virginia that manufactures special, high-reliability chips for automobiles.

Micron plans to spend up to $ 12 billion in capital spending and $ 3 billion in R&D next year

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Micron plans to spend up to $ 12 billion in capital spending and $ 3 billion in R&D next year

Micron Technology Inc said on Wednesday that it plans to build a new memory factory in the United States, but state and federal subsidies would be needed to offset costs that are higher than its factories in Asia.

The Boise, Idaho-based company is the only US company to manufacture the two main types of memory chips, competing with South Koreans Samsung Electronics Co Ltd and SK Hynix and Japan’s Kioxia, the former unit of Toshiba memory chips.

Micron has pilot manufacturing lines for the development of new technologies at its headquarters in Idaho and a plant in Virginia that manufactures special, high-reliability chips for automobiles. But its most advanced memory chips, which go into devices like PCs, phones, and data centers, are made in Taiwan, Japan, and Singapore.

Sumit Sadana, chief commercial officer of Micron, told Reuters that memory chips account for around 30% of the global semiconductor market, but only 2% are made in the United States.

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Sadana said the company has not chosen a country for its next advanced chip factory.

“We certainly want to take a very serious look at manufacturing in the United States, as the United States is expected to have more than 2% memory manufacturing for reasons of national security and supply chain resilience,” Sadana said in an interview.

Sadana said the company has not chosen a country for its next advanced chip factory. Factories will need tools like Extreme Ultraviolet (EUV) lithography machines from ASML Holdings, which can cost more than $ 100 million each.

Micron plans to spend up to $ 12 billion in capital spending and $ 3 billion on research and development next year, Sadana said, and up to $ 150 billion over the next decade.

Micron estimates that manufacturing costs for memories are 45% higher in the United States than in Asia, Sadana said.

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He said Micron’s decision will depend on bringing in US subsidies for construction plants and investment tax credits for expensive tools – both of which are being debated in the US Congress. “We need these policies to be stable and bipartisan in nature,” he said.

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