Catenaa, Thursday, November 05, 2026- Micron has halted plans to build a memory chip manufacturing facility in Taiwan because of extensive labor issues, Bloomberg News reported.
According to sources that spoke to Bloomberg News, the chipmaker has all but halted construction of a plant in the northern Taiwanese city of Taoyuan.
Bloomberg reported that uncertainty over labor negotiations in Taiwan influenced Micron’s decision. Company executives are reportedly concerned that an agreement already reached with one union could face further challenges from employees.
“Micron has informed Taiwanese officials and a supplier about its plans to suspend construction in the city,” the people told Bloomberg News.
Micron stock fell about 8% on Thursday after the news; the stock has led the AI chip sell-off, losing more than 31% since October 6.
According to Bloomberg News, tensions between Micron and its workers flared this year after employees demanded higher compensation, seeking more of the record profits generated from the AI build-out.
A prolonged delay could constrain Micron’s plans to expand memory-chip production at a time when AI-related demand is pressuring global supplies. Taiwan accounts for approximately 60% of the company’s DRAM output, making the island a critical part of its manufacturing network.
Micron, which has invested close to $50 billion in Taiwan over three decades, had planned to make high-bandwidth memory and DRAM at the new Taoyuan plant using top-end equipment from ASML Holding, according to Bloomberg News.
The new proposed Taoyuan plan would produce memory components that are essential to the AI infrastructure, despite not being up to current standards. High-bandwidth memory and DRAM are essential for Nvidia’s AI accelerators, and shortages have driven prices up.
“Taiwan plays an important role in Micron’s global footprint, and our operations today continue as normal,” Micron said in a statement according to Bloomberg News, without addressing questions about the Taoyuan complex. “We are confident in maintaining business continuity for our customers.”
Sources told Bloomberg News that Micron secured a deal with the bigger of its two unions in October, but the company may need to renegotiate because some employees are balking at the terms.
The suspension raises the possibility that Micron will reconsider plans for its broader manufacturing hub in Taiwan, which helps it compete with Samsung, SK Hynix, and CXMT, according to Bloomberg News.
“Micron had budgeted $3 billion to $4.5 billion for the Taoyuan complex, which included purchases of ASML gear,” one person told Bloomberg News.
According to Bloomberg News, despite the proposed suspension, safety-related work will continue at the site. The site was initially scheduled to come online in 2028.
