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Micron Technology has reportedly suspended its USD 4.5 billion Taiwan plant expansion following prolonged employee compensation disputes. Bloomberg News reported the development on Thursday, November 5, citing people familiar with the matter.
Construction of the proposed Fab 11E facility in Taoyuan became uncertain after disagreements over employee bonuses and profit-sharing arrangements. The suspension could disrupt Micron's expansion strategy as demand for advanced memory chips continues rising.
The US-based semiconductor manufacturer has reportedly informed Taiwanese officials and a supplier about its decision. Bloomberg sources described construction activity as almost entirely halted, with limited safety-related work continuing.
Micron originally planned to invest between USD 3 billion and USD 4.5 billion in the Taoyuan facility. The company expected the plant to begin operations in 2028, supporting advanced DRAM and high-bandwidth memory production.
The disagreement centers on employee demands for better compensation and a greater share of company profits. Workers argue that Micron's growing earnings should translate into stronger financial rewards during the AI-driven memory boom. The Taoyuan union has also pushed for transparent profit-sharing arrangements and additional cash incentives.
Micron reached an agreement with its larger Taichung union in October. However, some employees reportedly oppose the agreement, raising concerns about possible renegotiations.
The smaller Taoyuan union previously secured strike authorisation after unsuccessful compensation discussions. These developments have increased uncertainty around the company's Taiwan expansion plans.
The proposed Micron Taiwan plant would strengthen production capacity for DRAM and high-bandwidth memory. These components play an important role in AI accelerators, servers and large-scale data center infrastructure.
A prolonged construction delay could complicate Micron's efforts to meet growing demand. The company already competes with Samsung, SK Hynix and China's CXMT in the memory market.
Taiwan accounts for approximately 60% of Micron's global DRAM output. The company also employs around 15,000 people across its Taiwanese operations. This makes the island particularly important to its global semiconductor manufacturing strategy.
Micron said Taiwan remains important to its global operations and confirmed that current activities continue normally. The company added, "We are confident in maintaining business continuity for our customers." However, its statement did not directly address the reported Taoyuan construction suspension.
Taiwan's Ministry of Economic Affairs supports the existing union agreement and wants both sides to resolve disagreements. Reuters could not independently verify Bloomberg's report and noted that Micron had not immediately responded to its request for comment.
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