LG Innotek will invest $1 billion in a new factory in Vietnam: focus on semiconductors for AI and 5G
South Korean component manufacturer LG Innotek has announced plans to build a large plant for producing semiconductor substrates in Haiphong, Vietnam. The investment in the project will total $1 billion, underscoring the strategic importance of the region for the global chip supply chain.
Key timelines and production plans
According to official information, construction will begin in the third quarter of 2026. A trial launch of production lines is scheduled for the third quarter of 2027, with mass production expected in the third quarter of 2028. This timeline indicates that the company is betting on long-term development.
Specialization and sales markets
The new facility will focus on producing components for three key areas: 5G networks, specialized chips for artificial intelligence (AI), and devices with integrated AI functions. This fully aligns with current global trends, where demand for high-performance semiconductors is growing exponentially.
The choice of Vietnam is no coincidence: the country has already established itself as a reliable hub for the electronics industry due to its favorable investment climate, relatively low labor costs, and proximity to key Asian markets.
Expert assessment
In my view, this decision by LG Innotek is a clear signal to the market that diversifying production capacity beyond China and Korea is becoming not just a trend, but a necessity. Given the global chip shortage and rising geopolitical risks, localizing production in Southeast Asia helps reduce dependence on traditional supply chains. It is particularly noteworthy that the plant will serve precisely the AI and 5G segments—these are the areas that will define the technological landscape of the next decade. In the long term, such investments could significantly strengthen LG Innotek's position in the competitive race against giants like Samsung and TSMC.