SK Hynix has started construction on a $4 billion memory packaging facility in Indiana.

      SK Hynix has commenced construction on a plant in West Lafayette, Indiana, with an investment exceeding $4 billion. This will be the company's first facility in the United States dedicated to packaging high-bandwidth memory, with production expected to begin in the latter half of 2029. In contrast, Intel's similar assembly and testing operation near Wroclaw was canceled last year despite previously approved state assistance.

      The new SK Hynix plant will cover 133.5 acres and is projected to create around 1,000 jobs. Although production dates are far off, CEO Kwak Noh-Jung mentioned that the cleanroom is slated to open by October 2028, with mass production of the next-generation HBM commencing in late 2029.

      The significance of this plant lies more in its function than its cost. Advanced packaging technology integrates completed chips into a single unit, which is essential for the effectiveness of Nvidia's highest-performing accelerators.

      The U.S. government is contributing to the effort, as the CHIPS and Science Act allocates up to $458 million in direct support and up to $500 million in loans for this initiative.

      Europe previously had a similar facility that it ultimately lost. Intel's planned €4.6 billion assembly and testing facility near Wroclaw, which aimed to create 2,000 jobs, never materialized. Despite the European Commission approving €1.7 billion in Polish state aid in September 2024, Intel decided to halt the project that same month and officially canceled it by July 2025.

      European auditors had already assessed the situation. The Court of Auditors reported that the Commission's own projections indicated the EU would capture only 11.7% of the global chip production value by 2030, well below the target of 20%.

      The funding disparity largely accounts for this shortfall, with the auditors estimating that total funding for the Chips Act will reach approximately €86 billion by 2030. In comparison, the Commission is contributing €4.5 billion, while leading global manufacturers are projected to spend €405 billion within three years.

      Brussels has responded with increased ambition, as seen in the tech sovereignty package unveiled in June, which envisions a European foundry capable of producing 3nm chips and involves €120 billion in investment by 2035.

      Notably, packaging is not included in that proposal. The capability that Europe previously supported and lost is now being developed with substantial investment in the U.S.

      SK Hynix also has a range of alternatives available. It has already sent HBM4E samples to AI clients and has pledged tens of billions to expand capacity in Korea.

      Thus, the core question for Europe is not about funding a state-of-the-art fabrication facility but rather who will be responsible for assembling the chips afterward and in what location.