SK Hynix conditions new US factory on more US chip equipment exports to China, sources say

SK hynix

15/10/2026 03:00

Hynix is seeking new equipment for unused space in Dalian facility
Plant produces memory for SSDs that Solidigm sells to data centers
Expanded production from China would help Solidigm fund a new US NAND facility
By Karen Freifeld and Hyunjoo Jin
NEW YORK/SEOUL  Oct 14 (Reuters) - South Korea's SK Hynix is seeking approval from Washington to export US chipmaking equipment to China to increase production there as a condition for building a factory in the US, two people familiar with the matter said on Wednesday.
The Trump administration is pressing SK Hynix 000660.KS, Samsung 005930.KS and other foreign chipmakers to build plants in the US in a drive to rebuild US manufacturing capacity and create jobs.
Amid a global shortage of memory chips that has driven up prices, Solidigm, the US unit of SK Hynix, wants to install new equipment to produce NAND chips in unused space at SK Hynix's Dalian, China, site. NAND flash memory is used in solid-state drives installed in data centers for AI and cloud computing. 
     The Dalian NAND facility uses tools from major US semiconductor equipment makers like Lam Research LRCX.O, Applied Materials AMAT.O and KLA KLAC.O.
 Solidigm's pursuit of a US export license for additional equipment in Dalian and making its plan to build a new US NAND factory contingent on the license have not been previously reported. 
SK Hynix did not immediately respond to a request for comment. Solidigm declined comment on the matter.  
The US Department of Commerce, which oversees export controls and has been negotiating semiconductor manufacturing facility investments, did not respond to a request for comment.
The US has restricted exports of chipmaking equipment to China in a bid to slow Beijing's development of cutting-edge semiconductors used in AI and military applications, technologies that Washington views as critical to national security.
Reuters reported last month that Solidigm was considering building a NAND flash memory chip factory in the US. Semiconductor fabrication plants, known in the industry as fabs, take years and billions of dollars to build.
Expanded production from China would help Solidigm fund a NAND facility in the US, one of the people said, and provide a bridge to producing more in the US.
Solidigm is also weighing an initial public offering as early as next year, raising funds that could help finance its US factory, another source said.
     
PLANT IN DALIAN
After a memory market downturn a few years ago, the NAND market is now booming and is expected to remain tight over the next few years, according to Walt Coon, a memory industry expert at TechInsights. Pricing has increased sevenfold since mid-2023, he said.
Last year, the Commerce Department revoked authorizations granted to Hynix and Samsung that exempted them from having to apply for licenses for US equipment in their Chinese fabs, calling the authorizations a "Biden-era loophole."
Instead, the Commerce Department said it would grant export licenses to allow the companies to operate their existing fabs in China but did not expect to approve licenses for equipment to expand capacity or upgrade technology. In December, the department issued a 2026 license for SK Hynix's Dalian site that limited the quantity of equipment.
     SK Hynix's Dalian facility is home to a fab space known as Mod B that it built in 2023, one source said. It did not complete equipment buildout due to the memory market downturn.
     Mod B has some chipmaking tools in it, two of the sources said, with room for much more. 
The Commerce Department has not yet issued a license for  more US-made equipment and technology in 2027, one person said. Solidigm has also applied for an export license to buy additional tools for Mod B, the person said.
SK Hynix is separately in talks with Intel INTC.O to lease part of its long-planned chipmaking facility in Ohio. The South Korean company, which trails Samsung Electronics 005930.KS as the top two global NAND flash memory suppliers, also has broken ground on an advanced packaging plant for high bandwidth memory in Indiana. 
YMTC, China's NAND flash maker, moved up to No. 3 in the second quarter of 2026, according to Counterpoint Research.

 (Reporting by Karen Freifeld in New York and Hyunjoo Jin in Seoul; Editing by Chris Sanders and Cynthia Osterman)
 ((karen.freifeld@thomsonreuters.com))