AI · 2026-11-07
Micron Halts Taoyuan Plant Construction in Taiwan as Bonus Dispute Delays HBM Expansion
Micron is reportedly suspending a new semiconductor plant project it had been building in Taoyuan, Taiwan. As negotiations with the local union over bonuses drag on and uncertainty grows around the construction schedule, attention is turning to the company’s expansion plans for HBM and DRAM production.
Amid growing demand for high-bandwidth memory (HBM) driven by the expansion of the artificial intelligence (AI) industry, Micron’s new plant construction in Taiwan has hit a snag. Bloomberg, citing people familiar with the matter, reported that Micron Technology, the U.S. memory chip company, has effectively halted its plant project in Taoyuan, in northern Taiwan.
According to the report, prolonged wage and bonus negotiations with the local union, along with concerns that any agreement could be reversed, have increased uncertainty around the project. Management is said to have decided to suspend construction and informed Taiwan authorities as well as partner companies of the move. However, it has not been specifically confirmed yet how the suspension will affect the project timeline or investment plans going forward.
At the center of the dispute is how much of the company’s performance should be reflected in employee compensation. The union has been calling for bonuses equal to 15% of the company’s global operating profit. Micron has put in place a profit-linked bonus system, but the details have not been disclosed. Bloomberg reported that the Taichung union, the largest union in Taiwan, reached an agreement with the company on a revised bonus plan, while the Taoyuan union still appears to be struggling to find common ground over compensation levels and distribution standards.
The Taoyuan plant was originally intended to produce HBM and DRAM. Construction was expected to require between $3 billion and $4.5 billion, including the purchase of ASML equipment, with the plant slated to begin operations in 2028. As a result, this suspension is not just a matter of construction timing; it could also affect Micron’s broader plan to expand its manufacturing base in Taiwan. That said, based on the current reporting alone, it is difficult to determine whether the project has been fully canceled or could restart after negotiations.
Bloomberg also said Micron is a major foreign investor that has invested about $50 billion in Taiwan over the past 30 years. That helps explain why there is concern that any reduction in the company’s Taiwan operations could ripple through the local economy. Meanwhile, HBM is a type of memory designed to rapidly transfer data needed for AI computing, and expanding production facilities has drawn market attention because of its implications for supply capacity. Going forward, the key variables will be how the labor dispute is resolved and how the plant schedule and investment plans are adjusted as a result.
According to the report, prolonged wage and bonus negotiations with the local union, along with concerns that any agreement could be reversed, have increased uncertainty around the project. Management is said to have decided to suspend construction and informed Taiwan authorities as well as partner companies of the move. However, it has not been specifically confirmed yet how the suspension will affect the project timeline or investment plans going forward.
At the center of the dispute is how much of the company’s performance should be reflected in employee compensation. The union has been calling for bonuses equal to 15% of the company’s global operating profit. Micron has put in place a profit-linked bonus system, but the details have not been disclosed. Bloomberg reported that the Taichung union, the largest union in Taiwan, reached an agreement with the company on a revised bonus plan, while the Taoyuan union still appears to be struggling to find common ground over compensation levels and distribution standards.
The Taoyuan plant was originally intended to produce HBM and DRAM. Construction was expected to require between $3 billion and $4.5 billion, including the purchase of ASML equipment, with the plant slated to begin operations in 2028. As a result, this suspension is not just a matter of construction timing; it could also affect Micron’s broader plan to expand its manufacturing base in Taiwan. That said, based on the current reporting alone, it is difficult to determine whether the project has been fully canceled or could restart after negotiations.
Bloomberg also said Micron is a major foreign investor that has invested about $50 billion in Taiwan over the past 30 years. That helps explain why there is concern that any reduction in the company’s Taiwan operations could ripple through the local economy. Meanwhile, HBM is a type of memory designed to rapidly transfer data needed for AI computing, and expanding production facilities has drawn market attention because of its implications for supply capacity. Going forward, the key variables will be how the labor dispute is resolved and how the plant schedule and investment plans are adjusted as a result.
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#Micron Taiwan plant#Taoyuan semiconductor plant#HBM production expansion#DRAM production Taiwan#Micron bonus dispute#Taiwan labor union negotiations#ASML equipment Micron#Micron investment in Taiwan