Micron's plans for an additional DRAM fab in Hiroshima delayed until 2027

Micron's existing factory in Hiroshima, Japan
(Image credit: Micron Electronics)

Memory maker Micron Technology plans to construct a new DRAM factory in Hiroshima, Japan. The new plant will be equipped with extreme ultraviolet lithography (EUV) equipment, allowing it to manufacture Micron’s most advanced memory products. The company plans to break ground in early 2026 and have the plant up and running by 2027.

Micron announced in 2023 that it would invest up to 500 billion Japanese yen ($3.2 billion USD) to bring EUV equipment to Hiroshima, Digitimes reported. Originally, the intent was to begin mass production of the most advanced DRAM there by the end of 2025. The latest news represents a potential two-year delay in building the facility.

Once completed, the factory will produce 1-gamma DRAM, the next generation of computer memory technology. It will also manufacture high-bandwidth memory (HBM) for generative AI. Micron hopes to achieve a 25% market share in HBM by 2025. It currently lags behind SK hynix and Samsung, which produce 50% and 40% respectively of the world’s HBM.

Micron executive vice president and chief business officer, Sumit Sadana, estimates that the global market size for DRAM is growing by 15% each year. The executive expects HBM’s growth to be three times more than that. This means HBM sales could increase by 40% to 50% each year. That’s a lot of potential for Micron to capitalize on.

Now, reports indicate the initial investment in the new factory will be between 600 and 800 billion Japanese yen ($3.8 to $5.1 billion USD.) Japan’s Ministry of Economy, Trade, and Industry is reported to be covering one-third of the cost. It granted Micron a subsidy of up to 192 billion yen ($1.2 billion) for construction and equipment. Micron also received a subsidy to cover half of the necessary funding to produce HBM at the plant, amounting to 25 billion yen ($159 million).

So, while there’s been a delay in getting things up and running, the amount of money invested in the factory has increased. This is likely because Micron needs additional production capacity as soon as possible. Its HBM output for 2024 is already completely sold out, and Micron’s production for 2025 has also been 100% pre-ordered by customers.

Freelance News Writer