SanDisk and Kioxia are pursuing investments in new NAND fabrication facilities to expand storage capacity.
Kioxia and SanDisk plan to invest more than $31 billion (¥5 trillion) to expand NAND production in Japan, backed by Japanese government support. The companies’ joint venture currently operates NAND wafer fabrication plants in Yokkaichi, Mie Prefecture—the largest site—and Kitakami, Iwate Prefecture. Kioxia runs the fabs and manufactures the NAND wafers, while the joint venture finances the facilities and purchases the output, allocating approximately 60 percent to Kioxia and 40 percent to SanDisk.
Kioxia President and CEO Hiroo Ota stated: “This joint investment further strengthens our longstanding partnership with Sandisk and underscores Kioxia’s strong commitment to contributing to the advancement of an AI-driven society. Kioxia will continue to meet growing demand for high-capacity, high-performance, and power-efficient flash memory, which is essential to the growth of an AI-driven society. We sincerely appreciate the support of the Japanese government to date and recognize the importance of its continued strategic support in maintaining further strengthening our global competitiveness.” Ota met with Prime Minister Sanae Takaichi yesterday alongside SanDisk CEO and Chairman David Goeckeler. According to Asahi News, he told reporters he anticipates government subsidies covering roughly one-third of the total investment.
Prime Minister Takaichi offered a supportive but non-committal response: “The government warmly welcomes this further investment plan of 5 trillion yen over six years. We have high expectations that, through the two companies’ cooperation, they will further expand the development and manufacturing of next-generation memory semiconductors in Japan.” Goeckeler added: “In line with our business strategy and financial guidance, these planned investments will ensure our ability to support our customer’s increasing demands for our technology, while providing new economic opportunities for the communities we operate in and serving as a premier example of U.S.-Japan economic collaboration.”
The Yokkaichi site houses six fabs (Fab 2 through Fab 7), while Kitakami operates Fab 1 and Fab 2. The new capital will fund ongoing infrastructure expansion at both locations, along with associated technologies. A new Fab 3 is currently under construction, with production slated for fiscal 2029 and an estimated cost of approximately $11.3 billion (¥1.8 trillion). However, no additional Yokkaichi fab has been specified, leaving a significant portion of the ¥5 trillion allocation unaccounted for in public disclosures.
Addressing speculation, Kioxia issued a statement noting: “There have been media reports regarding the construction of a new manufacturing facility at the Kitakami Plant of Kioxia Corporation, a consolidated subsidiary of the Company. These reports are not announcements made by the Company or its subsidiary. The Company is considering various ways to steadily and sustainably increase corporate value, including the construction of new facilities.”
Both companies emphasized that the investment is contingent upon sustained Japanese government backing. Spanning from now through 2032, the funding aims to “further strengthen the companies’ long-standing joint venture and drive meaningful, multi-year flash memory-supply.” This follows January’s announcement extending their joint venture agreement for another five years, through December 31, 2034, and earlier this month’s confirmation of expanded NAND manufacturing capacity at both plants. The expansion is driven by projections that AI-fueled demand for NAND and SSDs will remain elevated for a decade or longer.
The push aligns with broader industry capacity expansions. SK Hynix is also ramping up NAND wafer manufacturing, having resumed construction on Solidigm Plant 2 in Dalian, China, following a prior market downturn. In South Korea, SK Hynix plans to break ground in February 2027 on its new Cheongju M17 NAND fab, spanning 206,000 pyeong (approximately 680,000 square meters). Meanwhile, Micron is advancing its own 3D NAND expansion with Fab 10B in Singapore, backed by a $24 billion investment. Construction began in January at the company’s existing North Coast Wafer Fab Park campus.