Major South Korean component manufacturer LG Innotek has announced large-scale plans to expand production capacity in Southeast Asia. The company intends to build a new plant for manufacturing semiconductor substrates in Haiphong, Vietnam, with a total investment of $1 billion.
Construction of the facility will begin in the third quarter of 2026. A trial run of the production lines is scheduled for the third quarter of 2027, with mass production expected to start in the third quarter of 2028. The new enterprise will specialize in producing components critical for the development of 5G technologies, artificial intelligence (AI) chips, and devices with built-in AI solutions.
This move underscores LG Innotek's strategic direction to strengthen its position in the global semiconductor supply chain. Vietnam is becoming an increasingly attractive location for high-tech manufacturing due to its favorable investment climate and access to a skilled workforce.
It is worth noting that the decision to build the plant specifically in Vietnam is no coincidence. The country has already established itself as a reliable hub for the electronics industry, attracting giants such as Samsung and Intel. For LG Innotek, this not only reduces production costs but also strategically diversifies risks associated with concentrating production in Korea.
My analysis: This investment is a clear signal to the market that demand for high-tech substrates for AI and 5G will only grow. LG Innotek is betting on a long-term trend, and starting construction in 2026 with a launch in 2028 appears to be a calculated move to secure a place in the supply chain just in time for the peak of the next cycle of AI solution adoption in the mass market segment.