Bank of America: SK Hynix's new capacity in 2028 may be only one-sixth of the original plan, DRAM price manipulation controversy resurfaces

The latest analysis from Bank of America shows that the actual additional memory chip capacity that SK Hynix can add by 2028 may be only one-sixth of the original plan. This assessment not only casts major doubt on the Korean government's capacity expansion blueprint but also provides key evidence for the ongoing class-action lawsuit regarding DRAM price manipulation.

According to a recent Bank of America report cited by Korean media, due to factors such as the closure of old factories, technological upgrades, and manufacturing process miniaturization, the actual annual increase in operating memory wafer capacity in Korea is less than 10%. This means the capacity increase by 2030 will be far below the "double capacity by 2030" target previously set by President Lee Jae-myung. Industry insiders in the memory chip sector further pointed out that the new capacity added by SK Hynix by 2028 may only be one-sixth of the original plan.

This assessment directly impacts supply expectations in the DRAM market. Meanwhile, on June 25 this year, Samsung, SK Hynix, and Micron all became targets of a class-action lawsuit in a California federal court, accused of conspiring to manipulate DRAM prices. Analysts believe that the severe lag in SK Hynix’s capacity expansion will further weaken the three major companies’ defense arguments in the lawsuit.

President Lee Jae-myung previously actively promoted the construction of large wafer plants by Samsung and SK Hynix in Gwangju and Jeolla, respectively, touting these projects as the core support for the "double capacity by 2030" goal. However, Bank of America’s analysis reveals a significant gap between this optimistic outlook and reality.

According to memory chip industry insiders, it will take about five years to complete the foundation work for the plants in Gwangju and Jeolla alone, followed by an additional three to four years for cleanroom construction and chip manufacturing equipment installation. It is expected that establishing a complete manufacturing ecosystem for both factory sites will take more than a decade.

Taking into account the capacity reduction resulting from the closure of old plants due to technological upgrades, Korea’s net annual increase in operating memory wafer capacity will be less than 10%, and the cumulative growth by 2030 will be significantly below the government’s set target.

On June 25 this year, Samsung, SK Hynix, and Micron were sued in a class-action lawsuit in a California federal court. The lawsuit represents groups of consumers and enterprises that purchased products containing commercial DRAM during the recent period of DRAM price increases, accusing the three companies of leveraging their dominance in the global DRAM market to coordinate reductions in the production of traditional memory formats such as DDR3 and DDR4, on the grounds of a strategic transition to AI-critical high-bandwidth memory (HBM), artificially driving up prices.

The capacity expansion delay highlighted in the Bank of America report echoes the core logic of the lawsuit mentioned above. If SK Hynix's new capacity by 2028 is only one-sixth of the original plan, then the market narrative of “a massive influx of new capacity is imminent” becomes untenable. This adds pressure to the three companies’ argument in the lawsuit that supply is constrained by objective factors.

The above analysis further strengthens the long-term view of tight memory chip supply. SK Hynix’s CEO has previously issued a public warning that 2027 will be the "worst year ever" for the memory industry, with shortages possibly continuing into the 2030s.

For investors, the substantial postponement of the timeline for meaningful expansion in memory capacity means that DRAM prices will remain constrained by the supply side for a prolonged period. Meanwhile, the progression of the class-action lawsuit will become a key variable affecting valuation and market expectations for Samsung, SK Hynix, and Micron.