Due to uncertainty on the US semiconductor tariff, Samsung is worried about its memory chips, mainly NAND flash memory. Since the firm produces the majority of its NAND in China, it may face difficulties once the tariffs go into effect. As a result, prices for memory products could go up, potentially impacting customers.
Samsung produces 40% of its total NAND output in China
According to the Korean media, Samsung produces 40% of its total NAND output at its Xi’an plant in China. NAND flash memory is a key component in making solid-state drives (SSDs), USB flash drives, memory cards, and more. The US government is mulling a huge tariff on NAND flash memory. Reports hint at an estimated 25% semiconductor tariff and a 145% tariff on China.
If imposed, this could raise production costs and lead to lower customer orders. So, the memory product manufacturers may increase their product prices to maintain their profit margin.
“Most NAND production is handled by customers in China, but NAND is an intermediate good, so additional tariffs may be imposed when finished products are exported,” a semiconductor industry insider said. “Considering that smartphones equipped with NAND flash produced in China are exported to the United States, the tariff burden could be greater than expected.”
Asia Business Daily reports that a 25% tariff on 128GB NAND could increase the component cost by around $2.50. As for high-capacity products, the prices could go up to $7.50. When adding logistics, packaging, manufacturing, and distribution margins, the final product price could go up to $15 per device.
Meanwhile, when it comes to DRAM, Samsung may breathe a sigh of relief. The company produces all of its DRAM in Korea, so the impact is fairly low. The US government will reportedly announce tariffs on imported semiconductor chips this week. However, an earlier report suggested that the Korean firm already plans to increase the prices for its DRAM and NAND flash memory chips by 3–5%. We will soon learn how the NAND price hike impacts consumer products.
