The shift follows Samsung Electro-Mechanics' announcement in late September that it would invest KRW 6.78 trillion won, or about $4.9 billion, to expand chip-packaging substrate production in South Korea and Vietnam. Of that total, KRW 4.27 trillion is earmarked for South Korea and KRW 2.51 trillion for Vietnam. The company said the expansion would allow it to meet global customers' demand for larger supply over the medium and long term.
SEMV has produced package substrates in Vietnam since 2021 as part of a broader build-up in the country. The pivot toward AI servers and large data centers signals a strategic reallocation of that capacity toward higher-value products at a time when AI infrastructure buildouts are straining supplies of advanced packaging components. Substrates such as UL FCBGA are critical to housing large AI accelerators, and capacity constraints in this segment have become a bottleneck for server makers.
The Vietnamese expansion also fits into Samsung's wider investment footprint in the country. Samsung Electronics plans to invest $1 billion in new capital in Vietnam in 2026, after cumulative investment there reached $24 billion by the end of 2025, CFO Park Soon Cheol said in July. For Samsung Electro-Mechanics, the Vietnam push complements its domestic spending and positions the company to serve global customers from a lower-cost Southeast Asian base.
For the broader industry, the decision highlights how AI demand is cascading through the semiconductor supply chain, elevating substrates from a supporting component to a strategically important input. As hyperscalers and server vendors race to scale AI capacity, suppliers that can deliver large-format, high-layer-count substrates stand to capture a growing share of value, while Southeast Asia's role as a manufacturing hub for advanced electronics continues to deepen.