SK Group Tae-won Chey: Semiconductor Demand to Surge Over 50% Next Year, Supply Gap Likely to Widen

Soaring Demand, Stagnant Supply: Semiconductor Supply-Demand Imbalance to Widen Further Next Year

According to Yonhap News Agency, SK Group Chairman and Korea Chamber of Commerce and Industry Chairman, Tae-won Chey, stated at a media roundtable held during the Jeju Forum that global semiconductor demand will see explosive growth next year. Demand in AI-related fields is projected to jump 60% to 100%, while overall semiconductor product demand will rise by at least 50% to 60%. Nevertheless, with virtually no meaningful new capacity coming online globally next year and incremental supply approaching zero, the already strained supply-demand gap will widen further.

Chey described the current state of global memory chip supply and demand as near "utter chaos." As countries and major enterprises around the world scramble to secure chip supplies, industry competition has long transcended the boundaries of pure market competition. Companies are being forced to bear heavy lobbying demands and operational strains, and memory chip supply is no longer a simple corporate management issue—it has escalated into a core national security issue tied to cross-border industrial chain stability. Currently, industry pressure is primarily concentrated at the corporate level, but South Korea is highly likely to face external pressure from multiple countries in the future, with industrial chain rivalry set to intensify.

Accelerate Global Capacity Expansion: Large-Scale Production as the Lifeline of South Korea's Semiconductor Sector

In response to recent demands from U.S. Commerce Secretary Howard Lutnick for South Korean semiconductor companies to expand investment in the United States, Chey responded that Washington has long made such requests, rather than this being a recent policy shift. Against the backdrop of global industrial chain restructuring, he laid out the core strategic direction for South Korea's chip industry, emphasizing that rapid capacity expansion and large-scale production are the fundamental way forward—and the lifeline—for preserving the sector's global competitiveness.

He emphasized that South Korean chipmakers must adopt a global mindset for capacity deployment and break geographical constraints. Whether at domestic plants in South Korea or overseas production bases in the United States, new production facilities should be considered wherever construction conditions are favorable and capacity advantages can be secured. Companies need to actively compare factory construction speeds and capacity ramp-up volumes across different regions, swiftly sort out project priorities, and advance new construction and expansion initiatives both domestically and overseas. Strengthening industrial foundations through global production capacity layout to address global chip supply and demand shifts and geopolitical industrial pressures.

Adopt a Rational Expansion Cadence to Prevent Backlash from "Chip Inflation"

Responding to concerns over the premature end of the semiconductor "super cycle," Chey argued that current global chip prices sit at abnormally elevated levels, and healthy price pullbacks are inevitable for sustainable industry development. If chip prices continue to rise, exacerbating the "chip inflation" phenomenon, the entire semiconductor industry will eventually face a backlash, and short-term windfalls from surging prices will erode the sector's long-term growth potential.

From his perspective, proactively increasing market supply to guide chip prices back to reasonable ranges does not necessarily mean corporate profitability will suffer. On the contrary, South Korea's semiconductor industry can only achieve long-term sustainable growth and break free from the vicious boom-bust cycle of "price surges → capacity expansion → oversupply → price collapse" by moving beyond the crude profit model reliant on price hikes, stabilizing market pricing, ensuring smooth supply chain operations, and continuously expanding overall market scale and development boundaries.