LG Innotek invests $1 billion in semiconductor substrate production in Vietnam
South Korean electronics component manufacturer LG Innotek has announced large-scale plans to expand production capacity in Southeast Asia. The company intends to build a plant for manufacturing semiconductor substrates in Haiphong, Vietnam. The total investment in the project will reach $1 billion.
Construction of the facility is scheduled for the third quarter of 2026. A trial production launch is expected in the third quarter of 2027, with mass production beginning in the third quarter of 2028. The plant will specialize in manufacturing components for high-tech sectors such as 5G networks, artificial intelligence, and devices with built-in AI capabilities.
A Strategic Move in the Global Chip Race
LG Innotek's decision to locate production in Vietnam is no coincidence. The country has long become a key hub for the semiconductor and electronics industry, attracting giants such as Samsung, Intel, and LG Electronics. Low operating costs, a favorable geographical location, and active government support make Vietnam an attractive alternative to China for companies seeking to diversify their supply chains.
Of particular interest is the focus on substrates for AI chips and 5G components. This indicates that LG Innotek is betting on long-term demand growth in these segments, which, in my estimation, will only intensify over the next 3-5 years. Amid a shortage of advanced semiconductor solutions, building in-house capacity for producing key components is not just an investment but a strategic necessity to maintain competitiveness.
Expert opinion: This move by LG Innotek is a clear signal that the industry continues to actively expand production capacity beyond traditional centers. Vietnam, in my view, will become one of the main beneficiaries of this trend in the coming years, receiving billions in economic inflows and strengthening its position in the global electronics supply chain.