Purdue University President Mung Chiang speaks during a press conference Wednesday in West Lafayette.
Purdue University President Mung Chiang made it official Wednesday: South Korea-based semiconductor chipmaker SK Hynix Inc. plans to establish a nearly $4 billion advanced packaging fabrication and R&D facility for microelectronics in West Lafayette.
Plans call for a 430,000-square-foot facility on 90 acres at the Purdue Research Park. The project is expected to create up to 800 jobs by 2030, and that number could grow to more than 1,000.
In return, the state is offering an incentive package of almost $700 million, making it the largest economic development deal in Indiana history.
Purdue said the plant will house an advanced semiconductor packaging production line that will mass produce next-generation high-bandwidth memory, or HBM, chips, which are a critical component of graphic processing units that train AI systems such as ChatGPT.
SK Hynix is the exclusive partner of Silicon Valley-based Nvidia to provide chips for the company’s graphic-processor units.
SK Hynix is the second-largest company in South Korea, just recently reaching $100 billion in market capitalization, according to Bloomberg. The company plans to begin mass production in Indiana in the second half of 2028, according to the university.
“We are excited to build a state-of-the-art advanced packaging facility in Indiana,” SK Hynix CEO Kwak Noh-Jung said in a news release. “We believe this project will lay the foundation for a new Silicon Heartland; a semiconductor ecosystem centered in the Midwest Triangle. This facility will create local, high-paying jobs and produce AI memory chips with unmatched capabilities, so that America can onshore more of its critical chip supply chain.”
Gov. Eric Holcomb, Sen. Todd Young (R-Ind.), Indiana Secretary of Commerce David Rosenberg, and former Purdue President Mitch Daniels were on hand for the announcement.
Young was a heavily involved in authoring and supporting legislation that eventually became the CHIPS & Science Act, which is expected to bolster U.S. semiconductor capacity through billions of dollars in federal funding.
“SK Hynix will soon be a household name in Indiana,” Young said. “This incredible investment demonstrates their confidence in Hoosier workers, and I’m excited to welcome them to our state. The CHIPS and Science Act opened a door that Indiana has been able to sprint through, and companies like SK Hynix are helping to build our high-tech future.”
The Indiana Economic Development Corp. is offering SK Hynix an incentive package that includes up to $3 million in training grants, up to $3 million in Manufacturing Readiness Grants, up to $80 million in conditional structured performance payments, up to nearly $555 million in Innovation Development District tax credits, and up to $45 million through the Industrial Development Grant Fund to support infrastructure improvements surrounding the new plant.
In addition to incentives from the state, the company also has applied for federal incentives made available through the CHIPS & Science Act.
Over the last two years, West Lafayette has grown to become a hub for semiconductor research and development. In July 2022, Minnesota-based SkyWater Technology detailed plans to invest $1.8 billion to build a semiconductor R&D and production facility in West Lafayette and create 750 jobs.
Purdue University has inked multiple international agreements focused on advancing R&D and workforce development in the semiconductor industry, including with manufacturers and higher education institutions in Japan, as well as the government of India and Belgium-based research and innovation center Imec.
In December, Purdue and Imec cut the ribbon on a new research and development hub at the Convergence Center for Innovation and Collaboration on the West Lafayette campus.
Last April, the university announced it was investing $100 million in semiconductor research and learning facilities as part of its Purdue Computes initiative. Purdue’s efforts have also received praise from U.S. Secretary of Commerce Gina Raimondo.
By Inside INdiana Business and IBJ staff
