▲ AI PRISM* Personalized Economic Briefing
* Editor’s note: AI PRISM (Personalized Report & Insight Summarizing Media) is an AI-based personalized news recommendation and summary service developed with support from the Korea Press Foundation. It selects and provides six news items tailored to each reader type.
■ HBM4 Golden Yield: The yield on Samsung Electronics’ (005930.KS) HBM4, the sixth-generation high-bandwidth memory that the company became the world’s first to ship in mass production this February, has approached the 80% mark. With the yield, which had stood below 60% early in mass production, stabilizing within six months, the company plans to more than triple its HBM4 revenue in the third quarter from the previous quarter and to raise HBM4’s share of second-half HBM revenue to more than 60%.
■ HBM Leadership Race: The HBM market, where SK hynix (000660.KS) had run out in front with a majority market share, is rapidly shifting beyond the technology development stage to a competition over production capacity built on yield stabilization. Samsung Electronics appears to be accelerating output expansion centered on its Hwaseong and Pyeongtaek sites. Development of the seventh-generation HBM4E has also cleared its final hurdles, prompting speculation that its mass-production timeline could be moved up.
■ Labor Dispute Widens: With SK hynix’s management and union having failed to find common ground even after five rounds of main negotiations over paying part of performance bonuses in company stock, the summer wage struggle at Hyundai Motor’s union is also dragging on. As a result, SK hynix faces mounting pressure on its HBM4 output expansion schedule, while Hyundai Motor (005380.KS) faces pressure on its second-half new-vehicle launch plans, including the new Tucson.
[News of Interest to Corporate CEOs]
1. SK hynix Wage Talks Stall Over Paying Bonuses in Company Stock, Raising Concerns Over HBM4 Output
– Key summary: SK hynix’s management and union held five rounds of main negotiations over the biggest sticking point in this year’s wage and collective bargaining agreement — paying part of performance bonuses in company stock — but failed to reach agreement. Management proposed paying more than half of the profit-sharing bonus (PS) in company stock and restricting its sale for a set period, but the union opposes the plan, saying it shifts onto employees the risk of losses from falling stock prices and the burden of capital gains tax. The two sides also remain far apart over a management proposal to “adjust wages in the event of losses,” and more than 3,500 people gathered within three days for a preparatory meeting to establish an integrated union covering both production workers and technical office staff. There are concerns that a prolonged standoff could weigh on the HBM4 output expansion schedule, which is set for a full-scale ramp-up in the second half.
2. Power of the ‘Memory + Foundry + Packaging’ One-Team Approach; HBM4E Mass Production Moved Up
– Key summary: The synergy of a turnkey system is cited as the reason Samsung Electronics reached an 80% yield just six months into HBM4 mass production. From memory to foundry and advanced packaging, the organizations collaborated as one team starting at the design stage, which is credited with overcoming the limits of the thermal compression non-conductive film (TC-NCF) process that had been seen as the biggest obstacle to achieving high yields. Global investment bank UBS forecast that SK hynix would hold the No. 1 position this year with 48% of HBM bit shipments, but that next year Samsung Electronics would narrowly edge out SK hynix (39%) with 41%. Meanwhile, Song Jai-hyuk, Samsung Electronics’ chief technology officer (CTO), said the reliability-test yield for the seventh-generation HBM4E had risen to more than 70%, and Samsung Electronics appears to have sent 12-layer HBM4E samples to major customers in late May.
3. Samsung Hits ‘Golden Yield’ on HBM4, Will Boost Supply
– Key summary: Samsung Electronics’ HBM4 yield has recently approached the 80% mark, laying the groundwork for expanded production. As of early mass production in February, the yield was below 60%, but the company achieved yield stabilization within six months by rapidly pushing process improvements amid an HBM shortage. In the semiconductor industry, an 80% yield is called a “golden yield” because it minimizes defect rates and secures stable output volumes and profitability. Samsung Electronics is also reported to have set a goal of raising its HBM market share to around 38% — the level of its DRAM market share — by year-end.
[News for Corporate CEOs’ Reference]
4. [Exclusive] With ‘Prolonged Summer Struggle,’ Hyundai Motor Faces Stalled New-Car Production
– Key summary: As the summer struggle by Hyundai Motor’s union drags on, even the production of new cars meant to drive a sales rebound faces disruption. Late last month, the union blocked a pilot model of the new Tucson that was set to be introduced on the production line at the Ulsan plant. The union has also carried out partial strikes totaling nine days on three occasions since declaring negotiations broken off last month, extending strike hours from four to eight hours a day. The union is demanding performance bonuses equal to 30% of last year’s net profit and a monthly base-pay increase of 149,600 won, but Hyundai Motor says that, given last year’s net profit of 10.3648 trillion won, it would have to pay more than 3 trillion won and cannot accept the demand. With Hyundai Motor’s global sales having declined for 10 straight months from last October through this July, plans to launch six new models in the second half are also bound to be pushed back one after another.
5. SK Clears First Regulatory Hurdle, Speeds Up ‘Renewable Energy Joint Venture’
– Key summary: SK and global private equity firm Kohlberg Kravis Roberts (KKR) are speeding up their work to create Asia’s largest renewable energy company. The Electricity Commission of the Ministry of Climate and Energy granted conditional approval for a plan to sell the 43.09% stake in SK Eternix (475150.KS) held by SK Discovery (006120.KS) and Hahn & Company to KKR’s newly established entity, Eclipse Holdco, clearing the first regulatory hurdle. The package deal totals 1.8 trillion won ($1.3 billion), and the joint venture will be structured with KKR holding 51% and SK 49%, aiming to launch by year-end. The two sides are reported to have set a goal of expanding the integrated entity’s power capacity from 1.7 gigawatts (GW) in 2026 to 10 GW by 2031.
– Key summary: The Daesan project in South Chungcheong Province, the first case of voluntary restructuring in South Korea’s petrochemical industry, will launch its integrated entity early next month. Lotte Chemical (011170.KS) will merge Lotte Daesan Petrochemical — created by carving out 1.1 million tons of naphtha cracking capacity (NCC) and other facilities from its Daesan plant — with HD Hyundai Chemical starting in September, with the integrated entity, in which HD Hyundai and Lotte Chemical will split ownership 50-50, set for a merger registration date of September 2. The two companies will operate the integrated entity’s NCC capacity after cutting it from 1.95 million tons to 850,000 tons, while HD Hyundai Oilbank and Lotte Chemical will each raise 600 billion won in capital, and the government will provide more than 2.1 trillion won in financial, tax and other support. Meanwhile, Lotte Chemical turned to profit with an operating profit of 110.1 billion won in the second quarter of this year, extending its streak of profits to two consecutive quarters.
▶ Read the article: Cucumber Prices Also Jump 55%, Raising Concerns August Inflation Will Rise Into the 3% Range
▶ Read the article: SK hynix Wage Talks Stall Over Paying Bonuses in Company Stock, Raising Concerns Over HBM4 Output
