Japan and U.S. Advance NAND Flash Factory Plan Led by Kioxia and SanDisk
Japan and the United States are advancing a public-private plan to build a NAND flash factory in the U.S., with Kioxia and SanDisk at the center, driven by surging AI data center demand.
| Advertisement | |
|
|
November 27, 2025 - The Japanese and US governments are considering a plan to build a NAND flash memory manufacturing facility in the United States through a public-private partnership. With support from both governments, the proposal envisions Kioxia Holdings (HD) and SanDisk Corp., long-time collaborators in NAND technology, serving as the project’s core investors.
The initiative is being driven by surging demand for NAND used in AI data centers, alongside the US government’s strong push to strengthen domestic semiconductor manufacturing. However, the plan faces significant hurdles, including differences over capital structure and management leadership, as well as geopolitical and regulatory risks such as potential scrutiny by Chinese authorities.
Kioxia HD and SanDisk have collaborated on NAND development since 2000. They currently co-invest and operate the Yokkaichi Plant in Mie Prefecture and the Kitakami Plant in Iwate Prefecture, Japan, while also cooperating in research and development.
Although the United States is home to NAND manufacturers such as SanDisk and Micron Technology, it lacks large-scale NAND production facilities. NAND remains a critical missing piece in Washington’s strategy to reshore semiconductor manufacturing.
In August, the US government announced plans to impose tariffs on imported semiconductors. President Donald Trump also pledged tax incentives for companies committing to build factories in the US. Competitors of Kioxia, including Samsung Electronics, SK hynix, and Micron, already operate manufacturing facilities in the US and may benefit from these measures. If Kioxia and SanDisk proceed with a US-based NAND plant, the move could help mitigate the impact of future semiconductor tariffs.
Nevertheless, significant challenges remain. Earlier discussions included proposals for joint Japanese-US investment and financing aligned with the Trump administration’s policies. However, some Japanese government officials expressed reservations, noting that NAND is a domain where Japan holds a technological advantage and arguing that overseas investment should be accompanied by strengthened domestic production capacity.
During negotiations, SanDisk is also reported to have explored an acquisition of Kioxia HD. In 2023, Kioxia and Western Digital—SanDisk’s former parent company—considered a merger, but talks collapsed due to opposition from SK hynix, an indirect investor in Kioxia, and uncertainty surrounding regulatory approval from Chinese authorities.
Both Kioxia and SanDisk are NAND specialists, while competitors from South Korea and China continue to expand their presence. Should the market enter another inventory adjustment cycle similar to the post-pandemic downturn, business continuity could become a key concern for both companies.
A shared strategic challenge for Kioxia and SanDisk is preparing for the next market downturn. If cooperation deepens through the construction of a US-based NAND factory, the partnership could potentially evolve toward deeper integration over the longer term.
Source: Nikkan Kogyo Shimbun
