Micron pauses its $4.5 billion factory plan in Taoyuan, labor disputes threaten AI storage expansion

According to Bloomberg, due to ongoing labor disputes with employee unions, Micron Technology has essentially suspended its plans to build a new storage chip factory in Taoyuan, Taiwan, with a project investment budget of $3 billion to $4.5 billion, originally scheduled to start production in 2028. Sources indicate that Micron is concerned that the agreement reached with the union may be overturned, and currently only a small amount of site safety maintenance work is being retained, after which construction will be frozen.

The dispute arises from employees' demands to share the profit growth brought by the AI boom. The Taoyuan union is requesting that Micron distribute 15% of its operating profits to global employees and hopes to receive a full cash bonus rather than a portion in stock. Although Micron reached an agreement with the larger Taichung union in October, some employees are dissatisfied with the terms of the agreement, and the Taoyuan union is attempting to expand its organization to push for renegotiation.

The project was originally planned to produce high-bandwidth memory (HBM) and DRAM using ASML's advanced equipment. Taiwan currently contributes about 60% of Micron's DRAM output and is also an important production base for HBM, employing approximately 15,000 people. Micron responded that the company's existing operations in Taiwan are normal and will ensure business continuity for customers, but did not directly comment on the suspension of the Taoyuan project. Taiwan's economic department stated that the government will assist Micron in resolving differences with the union and promote the implementation of the investment plan.