Samsung Electro-Mechanics to add $1.85 billion semiconductor investment in Thai Nguyen

Samsung Electro-Mechanics to add $1.85 billion semiconductor investment in Thai Nguyen

Samsung Electro-Mechanics, part of South Korean conglomerate Samsung Group, plans to invest $1.85 billion to expand semiconductor packaging substrate production in Vietnam, meeting growing demand from AI server and high-performance processor markets.

Photo: baodautu.vn

The investment is part of a total of approximately $5.05 billion at its Sejong business site and Vietnam subsidiary, according to a press release published on September 29. By site, $3.18 billion will be invested to expand flip-chip ball grid array (FCBGA) production capacity at the Sejong site, while approximately $1.85 billion will go towards expanding the FCBGA plant at the Vietnam subsidiary.

The Vietnam subsidiary aims to complete construction and begin operations by June 2030. Through this investment, Samsung Electro-Mechanics will significantly expand its FCBGA production capacity both in South Korea and overseas.

FCBGA is a highly integrated semiconductor substrate that connects high-performance chips such as AI accelerators, GPUs, and CPUs to the mainboard, supplying electrical signals and power. It is a key component determining the performance and stability of AI semiconductors.

As the AI server and high-performance computing markets have grown rapidly, demand for FCBGA has surged. AI semiconductors are evolving to integrate high-performance chips for high-speed computation and large-scale data processing, and as a result, FCBGA is advancing towards large-area, high-layer-count, and highly integrated structures.

With this investment, Samsung Electro-Mechanics aims to respond to growing demand for high-value-added semiconductor substrates in high-growth markets such as AI servers, high-performance chips, and automotive electronics. The investment is being pursued based on mid- to long-term cooperation with global big tech and semiconductor customers, including customer funding support and volume guarantees. This is expected to strengthen the competitiveness of the company's FCBGA business on a stable demand foundation.

The roles of the two sites are also clear. The Sejong business site, South Korea's production base for semiconductor substrates, will serve as a key hub for mass production of high-value-added products, responding to increasing demand for AI server substrates.

The Vietnam subsidiary, a major overseas production base with accumulated global manufacturing competitiveness, will operate as a strategic hub to meet global volume demand and enhance production efficiency through a stable supply system. With this FCBGA expansion, Samsung Electro-Mechanics will respond to global customers' mid- to long-term volume expansion needs while further improving production efficiency and supply stability.

President Chang Duckhyun said, "As the AI and high-performance computing markets grow rapidly, high-value-added semiconductor substrates are becoming increasingly important as key components that determine semiconductor performance and supply chain stability."

"Based on differentiated substrate technology and stable supply capabilities, Samsung Electro-Mechanics will be able to strengthen the competitiveness of its FCBGA business in high-growth markets such as AI servers and automotive electronics," he added.

Samsung Electro-Mechanics Vietnam operates a plant in Yen Binh Industrial Park, the northern province of Thai Nguyen. The project received its initial investment certificate in 2013, with registered capital of $1.2 billion, and began operations in February 2015. After several adjustments, the project’s registered capital rose to nearly $1.35 billion in May 2020.

When operations began, the plant mainly manufactured and assembled high-density interconnection boards and a number of electronic components and parts, including camera modules, power converters, touch modules and linear motors.

The company announced plans to invest $850 million to build FCBGA semiconductor packaging substrate production lines and infrastructure at its Vietnam plant in late 2021. The investment was expected to be carried out in phases through 2023.

According to Samsung Electro-Mechanics’s audited 2025 financial statements, its subsidiary in Vietnam acquired revenue of $2.19 billion and profit of $35.1 million during the year.

As of the end of 2025, Samsung Electro-Mechanics Vietnam had total assets of $1.95 billion and total liabilities of $1.25 billion. Samsung Electro-Mechanics owns 100 per cent of the subsidiary.

VIR