New semiconductor fab in Vietnam for LG...
LG Innotek will build a new semiconductor substrate manufacturing plant
LG Innotek, a key technology subsidiary of South Korea’s LG Group, is expanding its semiconductor substrate manufacturing footprint in Vietnam with plans to construct a new advanced production facility in Hai Phong. The investment forms part of the company’s broader strategy to strengthen its global manufacturing network, diversify production capacity and accelerate growth in advanced semiconductor packaging solutions.
The company recently signed a Memorandum of Understanding (MoU) with the Hai Phong city government for the development of the new facility. Construction is expected to begin in July, with completion targeted for May 2027.
The new plant will cover approximately 330,000 square metres, an area equivalent to around 45 football pitches. The investment will be carried out directly through LG Innotek’s Vietnamese subsidiary and will significantly expand the company’s semiconductor substrate production capabilities.
The facility will manufacture a range of advanced semiconductor substrates, including radio frequency system-in-package (RF-SiP) substrates, flip-chip chip scale package (FC-CSP) substrates, and flip-chip ball grid array (FC-BGA) substrates.
Dual Production Strategy Strengthens Global Capacity
LG Innotek plans to operate the Vietnam facility as part of a dual-production strategy designed to improve efficiency and competitiveness across its semiconductor packaging business.
Under this model, the company’s existing Gumi facility in South Korea will act as the “mother plant”, focusing on next-generation technology development, product innovation, prototype manufacturing and high-value-added products.
The expanded Vietnam operation will focus on high-volume production of established semiconductor substrates, allowing LG Innotek to optimise manufacturing efficiency while maintaining advanced technology development capabilities in Korea.
The company expects this approach will improve productivity, strengthen profitability and support long-term growth in its chip packaging solutions business.
Growing Demand for Advanced Semiconductor Packaging
The expansion comes as demand for semiconductor substrates continues to rise globally, driven by rapid growth in artificial intelligence, high-performance computing, automotive electronics and advanced communications.
RF-SiP substrates are expected to benefit from the continued rollout of 5G networks and future 6G technologies, as increasingly connected devices require smaller, more efficient and higher-performance semiconductor solutions.
Demand for FC-CSP substrates is also increasing as AI capabilities move closer to the edge, creating demand for compact, low-power chips used in smartphones, consumer electronics and intelligent devices.
Meanwhile, FC-BGA substrates are becoming increasingly important as global technology companies invest heavily in AI data centres and advanced computing infrastructure. These substrates support high-performance processors by enabling greater electrical performance, thermal efficiency and packaging density.
LG Innotek said its semiconductor substrate production lines at the Gumi facility are currently operating close to full capacity, highlighting the need for additional global manufacturing capability.
The company is also reviewing further investment opportunities in South Korea to strengthen its semiconductor substrate operations.
Expanding Korea-Based Technology Leadership
Earlier this year, LG Innotek signed an agreement with the Gumi city government to invest approximately 600 billion won (around $400 million) to enhance competitiveness in semiconductor packaging and related technologies.
The investment supports the company’s ambition to become a stronger global player in advanced packaging, a segment increasingly viewed as critical to the future semiconductor industry.
LG Innotek CEO Moon Hyuk-soo said semiconductor packaging solutions represent one of the company’s most important growth areas due to their strong profitability and expanding market potential.
Through its dual-production strategy, LG Innotek aims to increase annual revenue from its chip packaging solutions business to more than 3 trillion won (approximately $2 billion) by 2030. The company also expects the segment’s contribution to overall profitability to reach a level comparable with its optical solutions business.
As semiconductor architectures become more complex and demand for AI-enabled technologies accelerates, LG Innotek’s investment reflects the wider industry shift toward advanced packaging as a strategic driver of future chip innovation.
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