The United States’ biggest memory chipmaker, Micron, announced plans on Friday to invest 4.3 billion yuan ($603 million) in a Chinese facility despite Beijing’s tit-for-tat curbs against the company.
“This investment project demonstrates Micron’s unwavering commitment to its China business and team,” Micron CEO Sanjay Mehrotra said.
China’s cyberspace regulator said last month the US memory chipmaker failed a network security review and implemented a ban on the use of its chips in in key infrastructure.
Also on AF: China Warning on ‘Vicious Competition’ As Blinken Flies to Beijing
Micron made no mention of the review’s decision in its statement posted on WeChat on Friday.
The investment, in a chip packaging facility in the Chinese city of Xian, will include buying packaging equipment from a Xian-based subsidiary of Taiwan’s Powertech Technology, which Micron has been using in the factory since 2016, the company said.
Micron will also open a new production line at the site to manufacture mobile DRAM, NAND and SSD products to strengthen the plant’s packaging and testing capabilities.
The company did not disclose the value of the deal but said it would offer contracts to 1,200 employees of Powertech’s Xian subsidiary and that the investment would create an additional 500 jobs.
This would bring Micron’s workforce in China to more than 4,500 people, the company added.
Powertech said in a separate statement that the plan for Micron to buy the equipment was part of the 2016 agreement between the firms, so the financial impact on Powertech would be limited.
Micron’s announcement comes despite worsening relations between Washington and Beijing and an ongoing tech war between the world’s two biggest economies, spanning advanced technologies ranging from semiconductors to artificial intelligence (AI) and quantum computing.
Beijing’s ban on Micron was largely seen as retaliation against export restrictions implemented by the US and its allies on advanced chips and chipmaking gear to China, in an attempt to stifle the country’s tech might and military.
In May, Micron forecast a hit to revenue in the low-single to high-single digit percentages after the China ban.
A Reuters review of more than 100 public government tenders found that Chinese authorities were scaling back purchases of Micron’s chips before the ban.
- Reuters, with additional editing by Vishakha Saxena
Also read:
Biden Urged to Hit Back at China Over Micron Ban, Rally Allies
US Says ‘Won’t Tolerate’ China’s ‘Coercive’ Micron Chip Ban
China’s Micron Ban Adds to Asian Chipmakers’ Investment Woes
US ‘to Extend’ China Chip Curb Waivers for South Korea, Taiwan
Micron to Spend $3.7bn to Bring EUV Chipmaking Tech to Japan
Stifling China’s Progress ‘Disastrous’ For US: Yellen – NYT
