LG Innotek to Build $1 Billion Semiconductor Plant in Vietnam
The South Korean giant will establish its first overseas semiconductor substrate facility in the Hai Phong Free Trade Zone.
LG Innotek is expanding its global manufacturing footprint with a $1 billion investment in a new semiconductor substrate complex in Vietnam. The move marks the company's first semiconductor production facility located outside of South Korea.
The facility will be situated in the DEEP C Hai Phong 2 Industrial Park, occupying approximately 32 to 33 hectares. Construction is scheduled to begin in the third quarter of 2026. The company expects to launch pilot production by Q3 2027, with full-scale mass production slated to begin in Q3 2028. Notably, this project is the first to receive approval within the newly established Hai Phong Free Trade Zone.
Strategic Pivot to High-Tech Infrastructure
LG Innotek already maintains a presence in Hai Phong through a camera module manufacturing complex, but this new venture represents a strategic shift. The company is moving beyond assembly into the production of semiconductor substrates and packaging materials. These components are critical for the infrastructure powering AI servers, data centers, and next-generation telecommunications.
To manage this expansion, LG Innotek will implement a "two-center" operational model. Under this structure, the existing Gumi plant in South Korea will continue to handle research and development (R&D) and the production of high-value products. Meanwhile, the new Hai Phong plant will focus on the large-scale production of core substrates. This operational split supports the company's broader financial goal to increase revenue from its semiconductor packaging solutions segment to over 3 trillion won (approximately $1.94 billion) by 2030.
Impact on Global Supply Chains
This investment signals a significant realignment of the global semiconductor supply chain by moving high-end substrate production outside of South Korea. For Vietnam, the project validates the effectiveness of the Hai Phong Free Trade Zone model in attracting high-tech foreign direct investment (FDI) and positions the city as a growing hub for AI-related hardware.
Bruno Jaspaert, CEO of DEEP C Industrial Zones, stated that LG Innotek's decision to return to Hai Phong demonstrates "strong confidence in the city's long-term growth potential." Park Hong Keun, General Director of LG Innotek Vietnam Hai Phong, attributed the momentum to the city's skilled human resources, open investment environment, and the cooperation between local authorities and businesses.
Future Outlook
As the project moves toward its 2026 groundbreaking, industry observers will be watching how the Hai Phong facility integrates into LG Innotek's global logistics. The success of this plant will likely serve as a bellwether for other South Korean tech firms considering the relocation of high-precision semiconductor manufacturing to Southeast Asia.