Micron Halts Work on $4.5 Billion Taiwan Memory Plant Over Labour Dispute, Bloomberg Says

The project, valued at about $4.5 billion, was designed to produce DRAM and high-bandwidth memory (HBM), the stacked chips that sit alongside AI processors in data centre servers, using advanced equipment from ASML. Production had been scheduled to start in 2028. According to the report, only limited site safety maintenance will continue before construction is frozen, and Micron executives are worried that any settlement reached with the local union could later be overturned.

The pause matters because Taiwan is Micron's most important production base. The island accounts for about 60% of the company's DRAM output, is a key site for HBM and employs about 15,000 Micron staff. HBM is among the scarcest components in the AI supply chain, and memory makers have been diverting capacity away from phones and PCs to meet demand from AI server builders. Any delay to new Taiwanese capacity therefore reaches well beyond Micron's own plans.

Micron did not comment directly on the Taoyuan suspension. The company said its existing operations in Taiwan were running normally and that it would ensure business continuity for customers. Reuters said it could not immediately verify Bloomberg's report and that Micron had not responded to its request for comment, which was sent outside business hours.

At the centre of the dispute is how much of the AI-driven jump in Micron's profits should go to employees. The Taoyuan union wants the company to distribute 15% of its operating profit to staff, paid entirely in cash rather than partly in shares. In October the union said it was seeking a one-off bonus for fiscal 2026 worth about 83 months' salary and a permanent 15% share of quarterly operating profit from fiscal 2027. Micron's offer in September was for up to 68 months' pay, which the union rejected because it set no long-term formula. Micron's operating profit nearly tripled in fiscal 2026.

On October 22, Taoyuan union members staged a 24-hour walkout that Nikkei Asia described as the first strike in Taiwan's semiconductor industry. The union said 1,994 members, 99% of those who voted, had backed the action. The Taoyuan site has about 3,000 workers at a DRAM wafer fab.

The day before the strike, Micron signed a collective bargaining agreement with the union at its larger Taichung site, which handles HBM packaging and testing and employs about 12,300 people, while talks in Taoyuan broke down. Some Taichung employees are unhappy with the terms of that deal, and the Taoyuan union has been trying to expand its membership to push for a renegotiation, according to the reports. That raises the prospect that a settlement in one plant could reopen bargaining in the other, which is the risk Micron's executives are said to fear.

Micron's South Korean rivals have already conceded profit-linked formulas. SK Hynix agreed to pay staff 10% of annual operating profit with no cap, and Samsung Electronics' memory union tied bonuses to 10.5% of the chip division's operating profit, figures the Taoyuan union has used as benchmarks for its own demands.

Taiwan's Ministry of Economic Affairs said the government would help Micron resolve its differences with the union and continue to support the investment plan.