Samsung Electronics and SK Hynix are reportedly testing etching equipment from China's AMEC at their Chinese factories. The evaluations serve as a strategic hedge against tightening U.S. export controls, which transitioned from a "validated end-user" status in 2023 to temporary annual licenses in 2026. While Samsung denies the testing, industry experts note that U.S. restrictions are inadvertently driving foreign chipmakers to validate cheaper Chinese tools, boosting local suppliers like AMEC and Naura.
Korean chipmakers test AMEC equipment
- ▪Samsung Electronics officially denied testing Advanced Micro-Fabrication Equipment (AMEC) tools at its Chinese factories, while SK Hynix declined to comment or denied the testing.
- ▪Samsung Electronics and SK Hynix have been evaluating etching equipment from Chinese supplier Advanced Micro-Fabrication Equipment (AMEC) at their Chinese manufacturing plants for approximately two years.
- ▪The evaluations of Advanced Micro-Fabrication Equipment (AMEC) tools focus on Samsung Electronics' NAND flash facility in Xian, SK Hynix's NAND plants in Dalian, and SK Hynix's DRAM facility in Wuxi.
U.S. export control restrictions
- ▪The Chinese factories of Samsung Electronics and SK Hynix currently rely heavily on etching equipment from United States suppliers Applied Materials and Lam Research.
- ▪Samsung Electronics and SK Hynix are testing Chinese equipment as a strategic hedge to keep existing production lines running in case future United States restrictions block servicing, repairs, or replacement parts for Western tools.
VEU authorization revocation
- ▪The United States government revoked the "validated end-user" (VEU) authorization for Samsung Electronics and SK Hynix in 2025, later replacing it with temporary annual licenses covering equipment imports through 2026.
- ▪The United States Commerce Department granted Samsung Electronics and SK Hynix "validated end-user" (VEU) status in 2023, allowing them to import controlled United States tools without individual licenses.
Chinese equipment market growth
- ▪Deutsche Bank estimates that major Chinese equipment suppliers Naura Technology, AMEC, Piotech, and ACM Research will each generate more than $1 billion in revenue in 2026.
- ▪Chinese equipment suppliers are projected to capture 25% to 30% of China's estimated $28 billion wafer-fabrication equipment market in 2026, which could approach 40% when excluding lithography and metrology.
Western toolmakers face competition
- ▪A successful supply agreement with Samsung Electronics or SK Hynix would provide Chinese toolmakers with significant commercial validation, posing a long-term challenge to dominant Western suppliers like Applied Materials, Lam Research, and KLA.
- ▪Chinese semiconductor manufacturing tools are generally priced 20% to 30% lower than comparable equipment from established Western competitors.
Story comments
Loading comments…