LONDON As expected, Samsung Electronics Co. Ltd. announced on Monday (May 17) that it would double its capital spending to boost its capacity in semiconductor and flat-panel display manufacturing.
In a statement, Samsung said it would spend 18 trillion won (about $15.7 billion) in 2010. A further 8 trillion won ($7 billion) would be spent on R&D. With the investment in new manufacturing lines, Samsung expects to hire 10,000 new employees in 2010, including 3,000 for the semiconductor business and 4,000 for the LCD business.
Samsung had previously said it would spend at least 8.5 trillion won ($7.4 billion) on capital expenditure this year. The company now plans to spend 11 trillion won ($9.6 billion) on expanding semiconductor production and 5 trillion won ($4.3 billion) on boosting LCD manufacturing.
"Although the global economic environment and business conditions remain changeable and uncertain, if we invest aggressively in expanding facilities... these circumstances also present Samsung with an opportunity for future growth," Samsung chairman Kun-Hee Lee said in a statement.
As part of the moves, Samsung also held a ground breaking ceremony for a new memory semiconductor fabrication plant, Line-16, at its Nano City Complex in Hwaseong, Gyeonggi Province. It is due to begin production of chips in 2011. The fab is projected to cost 12 trillion won (about $11 billion).
To be constructed on approximately 560,000 square meters of vacant land within Samsung’s 1.6 million square meter Hwaseong complex, Line-16 is expected to produce 200,000 300-mm wafers monthly from 2011. It will be Samsung’s first new semiconductor line since the company opened its Line-15 in 2005.
With the announcement, Samsung’s Memory Division will increase its facilities investment for 2010 from its original plan of 5.5 trillion won ($4.8 billion) to 9 trillion won ($7.8 billion).
The additional investment includes establishing the new Line-16 for DRAM, NAND and next-generation memory products in Hwaseong, and increasing the capacity of the existing Line-15 for the production of 30-nm-class DDR3 DRAM.
Expansion of Line-15 will allow Samsung to increase the percentage of 30-nm-class DDR3 DRAM to more than 10 percent of its total production volume by the end of the year.
Further, Samsung will also invest approximately 2 trillion won ($1.7 billion) to boost its System LSI operations in meeting growing demand for system-on-chip (SoC) solutions for mobile handsets and digital TVs, and to strengthen its foundry business.
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