Micron commits $603 million investment in Chinatext_fields
American semiconductor manufacturing company, Micron Technologies, has committed to invest $603 million in China. The memory chipmaker will be making the investment over the next few years in its chip packaging facility in Xian City.
"This investment project demonstrates Micron's unwavering commitment to its China business and team," said CEO Sanjay Mehrotra in the statement posted on WeChat.
The company also announced that the investment will include buying packaging equipment from a Xian-based subsidiary of Taiwan's Powertech Technology. Micron has been using its products since 2016. A new production line is also going to be opened at the site to manufacture mobile DRAM, NAND, and SSD. This will strengthen the plant's packaging and testing capabilities.
The value of the deal was not revealed but 1,200 employees will be offered contracts. The investment will also create 500 more jobs.
However, last month, the company was targeted by China's cyberspace regulator after failing a network security review. The regulator said it will block operators of key infrastructure from buying from the company. This was not mentioned in Friday's statement, reported Reuters.
In May last week, US Commerce Secretary Gina Raimondo said the country will not tolerate China's effective ban on purchases of Micron Technology (MU.O) memory chips and is working closely with allies to address such "economic coercion." She added that the ban was to target a single American company without any basis in fact and the US see it as plain and simple economic coercion.
"As we said at the G7 and as we have said consistently, we are closely engaging with partners addressing this specific challenge and all challenges related to China's non-market practices. The investments in the CHIPS Act are to strengthen and bolster our domestic production of semiconductors. Having said that, we welcome participation from companies that are in IPEF countries, you know, so we expect that companies from Japan, Korea, Singapore, etc, will participate in the CHIPS Act funding," said the US diplomat.