How the U.S. Crushed Japan's Semiconductor Industry: Could Samsung and SK Hynix Be Next?

An unexpected warning has been issued regarding the South Korean semiconductor industry, which has been breaking record earnings day after day thanks to the AI chip boom.

Japanese media has raised concerns that the overwhelming market dominance of South Korean companies could eventually lead to serious trade friction with the United States.

The Nihon Keizai Shimbun analyzed that South Korean firms currently control 60% of the global memory semiconductor market, and that the DRAM market share of the top three players, including U.S.-based Micron, reaches a staggering 90%.

In fact, this oligopolistic structure has already sparked legal disputes in the United States.

Consumers and small businesses have filed a lawsuit for damages against Samsung Electronics, SK Hynix, and Micron, alleging that the companies artificially inflated prices by reducing the supply of general-purpose DRAM under the pretext of increasing production of High Bandwidth Memory (HBM).

Experts warn that if the supply of AI memory becomes too heavily concentrated in South Korea, the U.S.-Japan semiconductor dispute that shook the world in the 1980s could repeat itself.

At that time, the United States exerted intense trade pressure on Japanese semiconductor companies that dominated the global market, eventually forcing them to open their markets and accept price regulations through a semiconductor agreement.

This is why there are concerns that if South Korea’s dominance in semiconductors continues, the U.S. government could pull out trade pressure cards such as demanding the relocation of factories to the U.S. or requiring additional investments.

Ironically, while past U.S. efforts to keep Japan in check served as a stepping stone for South Korea and Taiwan to emerge as semiconductor powerhouses, experts point out that we could now become the target of such containment.

Furthermore, concerns over a supply glut due to large-scale facility expansions are also holding the industry back.

With Samsung Electronics and SK Hynix planning to invest 800 trillion won to build four new factories in South Korea, some observers predict that market conditions could deteriorate rapidly in the future.

In fact, even after Samsung Electronics recorded an all-time earnings surprise with its second-quarter operating profit surging more than 1,800% compared to the previous year, its stock price plunged by over 8% in a single day as these future trade risks and supply glut concerns were reflected in the market.

Reported by Lee Hyeon-yeong | Video by Lee Da-in | Graphics by Yook Do-hyun | Produced by SBS Digital News
※ Please note: This article was translated by AI and may contain errors.