AI Giants Invest Trillions of Won in Samsung Electro-Mechanics... Jointly Build Dedicated Substrate Line

Dedicated production lines to be built at Sejong and Busan sites
Opening the way for long-term supply of AI chip substrates

Samsung Electro-Mechanics is reportedly making facility investments with large-scale funding from NVIDIA and others. The move is seen as a response to surging demand for substrates used in artificial intelligence (AI) semiconductors, with big tech companies moving to secure supply in advance.

According to industry sources on October 22, Samsung Electro-Mechanics will build a new production plant dedicated to next-generation package substrates at its Sejong site through joint investments with global big tech companies, including NVIDIA. The companies are expected to share the cost of expanding the plant and receive priority supply of the high-specification substrates produced there over the medium to long term.

A view of Samsung Electro-Mechanics' Busan plant. Samsung Electro-Mechanics

Last month, Samsung Electro-Mechanics disclosed plans to expand its plant at the Sejong site, investing a total of KRW 4.27 trillion. Big tech companies are estimated by industry sources to invest approximately KRW 3.5 trillion to KRW 3.7 trillion, which is expected to cover a substantial portion of the construction costs. NVIDIA recently announced plans to invest in dedicated next-generation package substrate production lines at Samsung Electro-Mechanics' Sejong and Busan sites, and Tesla is also being mentioned by industry sources as a potential investor.

The backdrop to global big tech companies investing large sums in component production facilities is a bottleneck in component supply. Supply of high-performance package substrates, which support computing chips, has tightened as demand for AI semiconductors has surged. AI accelerators must process large volumes of calculations at high speed. This makes specialized substrates essential: they must accommodate densely arranged fine circuits and withstand the intense heat generated by chips.

By attracting this large-scale external investment, Samsung Electro-Mechanics has significantly eased the financial burden of expanding its facilities. At the same time, it has secured leading global companies as stable, long-term customers. Amid the shortage of substrates, the company is expected to strengthen its ties with big tech companies and further solidify its position in the high-value-added components market.

This content was produced with the assistance of AI translation services.