WASHINGTON — New York Gov. Kathy Hochul’s plan to open a computer chip plant outside Utica is raising concerns among federal officials who fear that China could gain greater access to advanced US technology.
Sources close to the Democratic governor told The Post Tuesday that she is in “advanced talks” with Solidigm, a subsidiary of South Korean chip giant SK Hynix, to open a semiconductor plant in Oneida County.
“There are red flags here with some yellow stars that the feds are really going to worry about,” quipped a federal official, who accused Hochul of being used to undermine US interests in the artificial intelligence arms race.
Hochul previously had an alleged Chinese spy, Linda Sun, as her deputy chief of staff from 2021 to 2023.
Sources expressed concern about the possibility that Chinese workers at the New York facility would give Beijing a “back door” to US technology and noted that the parent company wants to loosen new Trump administration export rules on chipmaking equipment that can be sent to China.
SK Hynix wants to condition the opening of a new US manufacturing facility on the Commerce Department granting export licenses for advanced equipment for use at a Chinese factory in Dalian, Reuters reported this month.
“It’s very clear why SK wants to do this deal. The Chinese are pressuring them,” said Leland Miller, who serves on the U.S.-China Economic and Security Review Commission, a 12-person body formed in 2000 to advise Congress on national security concerns involving trade with China.
“[The Chinese] have been pressuring them for a long time in terms of their operations in China, and Beijing would like to see more of a buildout in China,” Miller said.
“The reason for this is that the Chinese absolutely want to catch up with the Koreans and Americans in terms of memory chip buildout.”
Hochul spokeswoman Kristin Devoe brushed off criticism, saying in an email that “projects like this are required to undergo a comprehensive federal national security review.”
“This company [Solidigm] was founded and is headquartered in the United States and is responding to a directive from the Trump Administration to build what would be America’s only domestic fab of its kind,” she added. “Reshoring this vital technology would mean THOUSANDS more American manufacturing jobs and chips made here instead of overseas.”
The Biden administration in December 2024 offered SK Hynix $458 million in grants and $500 in loans under the CHIPS Act to build a different manufacturing plant in Indiana, which remains under development.
Miller, who is also CEO of China Beige Book, which tracks Chinese economic data, said that the New York manufacturing facility would offer “a back door for the Chinese to be observing advanced memory capacity buildout in action.”
“All these facilities are going to have more advanced IP than what they’ve been exposed to thus far. So they will be moving the needle forward for China, no matter what. The question is how much,” Miller said.
“It’s very clear what’s driving this process. It’s an age-old problem where the Chinese put pressure on companies to say, ‘Look, we want this in return for that,’ and so the possibility that this is going to have negative effects based on exposure to IP is very, very high.”
Solidigm said in a statement that the company “regularly evaluates strategic alternatives to enhance its long-term competitiveness.”
“The company is currently exploring options for building a NAND memory fab at potential locations around the world, including the U.S. No decision regarding any specific course of action has been made,” the company said.
