SK hynix Inc. said Friday it will invest a combined 54.3 trillion won ($38.3 billion) to build new semiconductor fabrication plants in response to rapidly growing demand for artificial intelligence (AI) memory chips.

The investment plan, approved at a board meeting, includes 35.2 trillion won for the construction of the Y2 fab in Yongin, just south of Seoul, and 19.1 trillion won for the M17 fab in the central city of Cheongju, the world's second-largest maker of memory chips said in a regulatory filing.

The decision marks the execution of SK hynix's mid- to long-term investment strategy and aligns with the government's "tripolar mega project" initiative, unveiled last month by President Lee Jae Myung to strengthen advanced technologies nationwide and position South Korea as a global industrial powerhouse in the AI era.

Under its long-term investment plan, SK hynix has pledged to invest 600 trillion won in the Yongin semiconductor cluster and 100 trillion won to expand its production base in Cheongju.

"In the AI era, technological competitiveness alone is not enough and the ability to supply the required volume at the exact moment customers need it is the ultimate competitive advantage," SK hynix said in a press release.

Y2 will be the second of four fabs planned for the Yongin semiconductor cluster.

Construction of the Y2 fab is scheduled to begin in July next year, with the first cleanroom expected to open in June 2029 for the production of high-bandwidth memory (HBM) and other next-generation dynamic random-access memory (DRAM) products.

Construction of Y1 is also progressing as planned, with its first cleanroom scheduled to open in February next year.

SK hynix previously announced plans to complete the Yongin semiconductor cluster by 2033, bringing forward the original completion target of 2045 by 12 years.

The Y2 project represents the second phase of that accelerated expansion, with investment continuing through October 2031.

The company selected Cheongju as the site for its new NAND flash memory fab because it offers the shortest construction timeline.

The Cheongju campus already houses the M11, M12 and M15 fabs, allowing efficient integration with existing production facilities and infrastructure, including power and water supplies, SK hynix said.