Micron to invest $600 million in Chinese factory despite Beijing ban

Micron plans to invest more than $600 million in its factory in the Chinese city of Xi’an, demonstrating its commitment to China just weeks after the US memory-chip maker stopped supplying the country’s critical infrastructure operators. was stopped.

Last month, Beijing banned major operators from purchasing from the Idaho-based company after an investigation found its products posed a “serious network security risk.”

The company made no mention of Beijing’s action in its announcement posted on Friday on the WeChat social media app. Micron said it would invest Rmb4.3bn ($603mn) over the next few years to upgrade its chip packaging and testing equipment at the Xi’an factory.

“This investment reflects Micron’s unwavering commitment to its China business and team,” said Sanjay Mehrotra, Group Chief Executive Officer.

Micron’s announcement comes as the Chinese consumer electronics conglomerate is laying out plans to replace the conglomerate’s memory chips, according to two people with knowledge of the matter. Beijing’s announcement last month did not specify how broad the sanctions were, but industry insiders said the tech group was already preparing to renew work in case Micron was completely cut off from use in the country’s products. Was doing.

Micron did not respond to a request for comment.

As part of the planned investment, Micron will add 500 new jobs, bringing its total in China to more than 4,500.

The chipmaker will also buy packaging equipment from the Xi’an-based subsidiary of Taiwan’s PowerTech Technology, which it has been using at the factory since 2016. Micron also plans to build a new production line for memory chips at the facility, saying “the project has been in preparation for some time”.

Beijing’s action against Micron was seen as the first significant punitive action against the US semiconductor company in response to Washington’s tighter restrictions on chip-related exports to China.

This was followed by a seven-week investigation into Micron led by the Cyberspace Administration of China.