People familiar with the talks told Reuters that US fabrication would cost substantially more because of higher construction and labor expenses.

But US government policy is making that comparison less straightforward. SK hynix’s Indiana project received up to $458 million in federal CHIPS funding, while a White House semiconductor proclamation in January proposed broader chip tariffs alongside a “tariff offset program” that would give more favorable treatment to companies investing in US production.

“If you compare only manufacturing cost, Korea will almost always win,” an industry official said. “But if a major cloud company is willing to guarantee five or seven years of volume, you take a lot of uncertainty out of a multibillion-dollar investment.”

“Then you are asking whether the US premium is worth paying for guaranteed demand, subsidies and less exposure to future tariffs, not simply whether a wafer costs more.”

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