On Thursday, Samsung Electronics Co Ltd stated, it has broken ground for its sixth domestic contract chip production line which will produce logic chips. The development comes in the wake of Samsung’s efforts to reduce its reliance on the volatile memory chip sector.

With this move, Samsung will be taking on bigger rival Taiwan Semiconductor Manufacturing Co Ltd (TSMC) in the contract manufacturing space where it will compete for orders from customers which will include Qualcomm Inc.

The new production line will be located in the Pyeongtaek, just two hours away by road from Seoul.

Samsung’s new production line will produce advanced 5 nanometre chips using extreme ultraviolet (EUV) technology.

Samsung broke ground earlier this month and plans to start production in the second half of next year.