LG Electronics dives into semiconductor equipment, developing HBM chip for AI applications

Seoul [South Korea], July 29 : LG Electronics is making a strategic push into the semiconductor equipment sector, focusing on building key machinery for producing high-bandwidth memory (HBM) chips essential for AI applications, as reported by the Korea Herald.

The South Korean tech firm recently confirmed that its in-house research team, the Production Engineering Research Institute, has begun developing a hybrid bonder, an advanced chip packaging device. The machine is intended for use in manufacturing HBM chips, which are central to powering AI technologies.

According to the Korea Herald, a media report suggested that LG is targeting commercialisation by 2028, the company clarified that although hybrid bonder development is underway, no concrete timeline for mass production has been set.

Semiconductors are a sensitive subject for LG. The company lost its chipmaking arm, LG Semicon, during the 1997 Asian financial crisis when the government ordered its merger with Hyundai Electronics, now known as SK hynix.

Despite this setback, LG continued to invest in semiconductor-related R&D, designing custom chips for its products and recently teaming up with Canadian AI chip design firm Tenstorrent.

LG's Production Engineering Research Institute has also worked on HBM-related technologies and currently provides packaging and testing equipment. The company's renewed focus aligns with LG Group Chairman Koo Kwang-mo's broader AI strategy, as it aims to tap into the rapidly growing demand for AI chips.

Experts believe LG has a shot at success. "LG is entering the market because there's clear business potential," said Lee Jong-hwan, a professor of system semiconductor engineering at Sangmyung University. "HBM is expected to see continued growth because it is a critical component in AI chips, which are becoming dominant in the market."

Lee noted that the Production Engineering Research Institute has long handled equipment and systems related to mass production.

"So they have strengths in developing related tools. That's why they are confident in commercialising this technology," Lee said.

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