China scales up chips
China’s leading memory-chipmaker YMTC plans two new factories that would more than double its production capacity as trade tensions with the US continue to shape strategy. (reuters.com) At the same time, China is rerouting imports of chipmaking tools through Southeast Asia and backing domestic equipment champions, changing the practical routes for semiconductor production and supply. (digitimes.com) Research also notes that despite US tech curbs, China is still capturing indirect benefits from the surge in American AI investment. (scmp.com)
China’s top memory-chipmaker is planning enough new factory space to more than double output, even as United States export curbs stay in place. (usnews.com) Yangtze Memory Technologies, known as YMTC, aims to add two factories on top of one due for completion in 2026, according to Reuters. The three sites together would lift capacity above the company’s current roughly 200,000 wafers a month to about 400,000, people familiar with the plan said. (usnews.com, techpowerup.com) A wafer is the round slice of silicon that chipmakers process in batches, so more wafers a month usually means more chips leaving the line. YMTC makes NAND flash memory, the storage chips used in phones, laptops and solid-state drives. (techpowerup.com, usnews.com) The expansion comes after Washington tightened semiconductor controls in October 2022 and after the United States added YMTC to the Entity List in December 2022. Those rules made it harder for Chinese chipmakers to buy advanced tools and technology tied to United States suppliers. (federalregister.gov, faegredrinker.com) China has responded by changing both where tools come from and who makes them. DigiTimes, citing a Nikkei Asia analysis, reported on April 15 that China’s imports of chipmaking equipment from Southeast Asia jumped in 2025 and moved past direct shipments from the United States. (digitimes.com) Beijing has also pushed fabs to buy more local gear. Reuters reported on December 30, 2025 that Chinese authorities were requiring chipmakers to use at least 50% domestically made equipment when they add new capacity, a policy that has lifted companies including Naura Technology Group and Advanced Micro-Fabrication Equipment Inc China. (usnews.com) That does not mean the supply chain is sealed off. South China Morning Post reported on April 14, citing Oxford Economics research, that China remains tied into Asian electronics networks and is still positioned to capture part of the demand created by the United States data-center and artificial-intelligence spending boom. (scmp.com) Other Chinese chip companies have already been reporting stronger numbers on that demand. CNBC reported on April 3 that Semiconductor Manufacturing International Corporation, Hua Hong Semiconductor and other mainland firms posted record 2025 revenue as domestic artificial-intelligence demand and import substitution lifted sales. (cnbc.com) For now, YMTC’s factory plan shows how the contest has shifted from a simple question of access to one of routes, substitutes and scale. The next test is whether China’s fabs can keep expanding with more local equipment and more indirect supply lines without losing yield, cost control or speed. (usnews.com, digitimes.com, scmp.com)
