Introduction: According to TechNews on January 16, SK Hynix is currently upgrading the manufacturing process at its Wuxi plant in China and is also circumventing the U.S. ban on the export of EUV lithography machines to China through transportation methods.
The report, citing South Korean market insiders, states that SK Hynix plans to upgrade a portion of its C2 wafer fab capacity in its Wuxi, China plant to the 10nm-class fourth generation (1a) DRAM process technology. This upgrade is in preparation for expanding production to meet upcoming market demands.
Currently, the Wuxi plant in China is SK Hynix’s main production base, with its capacity accounting for about 40% of SK Hynix’s total DRAM output. The plant is currently producing 10nm-class second generation (1y) and third generation (1z) DRAM products, which are considered older process technologies.
However, SK Hynix’s 10nm-class fourth generation DRAM requires the use of EUV lithography machines. Due to the inability to introduce EUV lithography machines into the Wuxi plant in China, the fourth generation DRAM cannot be directly produced in Wuxi.
Following the exemption granted by the U.S. government to SK Hynix in 2023, the company began importing equipment for manufacturing DRAM with processes of 18nm and below to its Wuxi plant in China. However, the import of EUV equipment into China is still not permitted, presenting challenges in upgrading the fourth-generation DRAM production line at SK Hynix.
To address this issue, SK Hynix has chosen to use a “transportation” method for the process transition. This involves conducting the initial stages of production for the fourth-generation DRAM wafers at the Wuxi plant in China, then sending the wafers back to the headquarters in Icheon, South Korea, to complete the EUV process, and finally returning them to Wuxi to complete the remaining steps.
It is reported that the cost increase is acceptable to SK Hynix, as the EUV process for the fourth-generation DRAM products only requires a single layer of exposure. In fact, the company previously used this method to overcome disruptions in DRAM production during a fire at its Wuxi plant in 2013. However, regarding the upcoming process transition at the Wuxi plant, SK Hynix has stated that it cannot confirm specific operational plans for the factory.
During the fire at the Wuxi plant in 2013, some production lines were completely destroyed, causing production interruptions. Partially completed wafers were loaded onto airplanes and brought back to SK Hynix’s Icheon plant in South Korea to undergo the necessary missing processes, and then returned to China for completion.
Due to the fire, the Wuxi plant’s capacity was halved to 65,000 wafers per month. By using the method of “flying wafers by airplane,” SK Hynix minimized the risk to DRAM supply as much as possible and rapidly recovered within two and a half months. This quick recovery overturned the industry’s expectation that the crisis would last six months to a year and overcame an unprecedented DRAM supply and demand crisis.
Now, SK Hynix is set to replicate the strategy it used a decade ago. Whether this inventive solution suggests that other manufacturers might also adopt similar methods to address processes that cannot be specially handled domestically is something to watch for.
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