Washington is developing targeted semiconductor tariffs that would exempt US-built chips while taxing imports, pressuring Samsung Electronics and SK hynix to deepen American manufacturing commitments beyond the $41 billion already planned.
Back
US Tariff Plan Pressures Samsung, SK hynix on $41B US Buildout
Washington is drafting a targeted tariff regime that waives duties on chips built in the US while taxing imports, pushing Samsung Electronics and SK hynix to weigh deeper American investment beyond the $41 billion already committed.
"If you build here, you don't pay, but if you don't build here, expect to pay to enter the greatest market in the world," Howard Lutnick, US commerce secretary, said in a Sept. 2 Bloomberg TV interview, naming Samsung and SK hynix directly and telling them "they need to build here."
Samsung is investing more than $37 billion in Texas on advanced logic and research facilities, while SK hynix is building a $4 billion high-bandwidth memory packaging plant in Indiana. Neither project moves memory production itself onto US soil — Samsung's outlay is foundry-focused and SK hynix's facility packages chips made in South Korea — leaving both exposed if Washington extends tariffs beyond chips to finished goods such as laptops, gaming consoles and data center servers, with country-specific rates and quotas under discussion.
The pressure lands on top of a $350 billion South Korean manufacturing investment pledge agreed by the two presidents last year, which secured Section 232 safeguards ensuring Seoul receives terms no less favorable than other major chip-trading nations. Yet Washington's direct company-level demands operate outside those country-level conditions, and Seoul is watching rivals court its chipmakers: Japan has pledged more than 10 trillion yen ($63.27 billion) in AI and semiconductor support through 2030, with Miyagi Prefecture offering SK hynix a large-scale site with water and power infrastructure.
A senior Seoul official confirmed Friday that semiconductors are among the investment issues under discussion with Washington as part of broader bilateral talks, telling reporters the two countries' negotiations "sometimes affect each other." The Presidential Office said Sept. 3 that specific tariff details have not been finalized and that it is monitoring developments closely while seeking to prevent any adverse impact on Korean companies.
Lutnick's remarks mark an escalation from his July comments at a Micron event, when he said he wanted to bring the two Korean companies to build plants in the US. The shift recasts tariffs as an industrial policy tool aimed at compelling individual companies to relocate production rather than a country-level trade measure. The last time Washington leaned on market access this way, in the tariff round that preceded last year's bilateral agreement, Korean exporters faced uncertainty over Section 232 duties on chips and manufacturing equipment before Seoul secured its safeguards.
For Samsung and SK hynix, the calculation now spans three geographies. Expanding US memory production would satisfy Lutnick's demand but carries higher construction and labor costs than their Korean fabs; staying put risks tariffs on the roughly half of global memory output the two companies control. Japan's subsidy-backed offer provides a third option, though one that would still face US import duties. With AI demand accelerating — US technology companies are spending heavily on data center infrastructure that consumes the high-bandwidth memory SK hynix dominates — the outcome of the talks will help determine where the next wave of advanced chip capacity lands.
The Presidential Office has signaled it will resist any demand that forces memory production itself to relocate, viewing the current foundry and packaging investments as sufficient. But Lutnick's direct naming of the two companies suggests Washington may not settle for that. If the US finalizes tariffs that exempt only locally produced chips, Korean memory makers face a choice between absorbing duties on their largest export market or committing billions more to American fabs — a decision that would reshape global chip manufacturing geography and the competitive balance with rivals such as Micron Technology and Taiwan's TSMC.
This article is for informational purposes only and does not constitute investment advice.
