In a statement to the South China Morning Post late Wednesday, SK Hynix appeared to retract Noh’s comments, noting that the company plans to cease operations in China or close facilities. Said never.

SK Hynix said, “We will do our best to ensure the stable operation of our facilities in China.”

Earlier this month, the U.S. Department of Commerce announced a major update to its regulations. Strengthening export controls For advanced semiconductor and specific chip manufacturing tools for companies based in China.

Foreign-owned Chinese wafer fabs, including SK Hynix’s 300 mm DRAM wafer fab, will be given a one-year grace period during which they can continue to import equipment from the United States. Samsung Electronics When Taiwan Semiconductor Manufacturing Fabs in China are also exempt.

Still, U.S. regulations are casting a shadow over the long-term prospects for these companies’ operations in China.

SK Hynix factory in Cheongju, Chungcheongbuk-do, South Korea.Photo: Kyodo

SK hynix is cancel the plan Reuters reported at the time that U.S. officials were considering upgrading the Wuxi facility because they didn’t want the advanced equipment to enter China.

Analysts said South Korean semiconductor giants such as SK Hynix and Samsung should reconsider the costs and benefits of doing business in China under new US regulations.

Gary Ng, senior Asia-Pacific economist at investment bank Natixis, said these firms “have no choice but to assess the risks of factories in China.”

“We may see more companies selling or transferring assets out of China to mitigate such risks,” Ng said. “Given that the US goal is to freeze China’s progress, there may ultimately be some flexibility in maintaining existing fabs, but further expansion will become increasingly difficult. will be.”

Mark Lee, a senior analyst at asset manager Bernstein, said in a recent report that the one-year grace period would only give Samsung and SK Hynix a temporary “breather.”

“In the long run, we believe it is the goal of the United States to curtail or force Samsung and SK Hynix to cut, if not cut, their manufacturing operations from China.”

SK Hynix memory chips visible on circuit board.Photo: Reuters

SK Hynix memory chips visible on circuit board.Photo: Reuters

The shutdown of SK Hynix’s China factory will not only deal a heavy blow to China’s position in the global semiconductor supply chain, but it will also spur Beijing’s desire to reach out to South Korean companies to mitigate the damage caused by US sanctions. It will also deal a heavy blow to hope.

The Wuxi factory is currently the largest foreign investment project in Jiangsu. This is important for the global electronics industry as it accounts for about half of SK Hynix’s DRAM chip output and about 15% of global output.

The Wuxi government has built the entire industrial park together with SK Hynix, investing more than US$20 billion in 15 years. The company is so important to the local economy that the hospital and elementary school are named after him, SK Hynix, according to the government.

SK Hynix this week Third Quarter Sales Reportedly Weak KRW 10.98 trillion (US$7.7 billion) decreased by 20.5% from the previous quarter due to weak demand for DRAM and NAND products amid the worsening macroeconomic environment worldwide.

The company said it will cut investments in 2023 to less than half of last year’s.

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