SK Hynix is reportedly seeking US approval to expand its China operations. According to a report by the news agency Reuters, the South Korean memory chipmaker wants Washington’s permission to export additional US-made semiconductor manufacturing equipment to its Dalian facility in China. The report cited two people familiar with the matter, who said SK Hynix has made this a condition for funding its planned investment in American manufacturing.The report claims that the company’s US unit, Solidigm, is seeking an export licence to install equipment for producing NAND flash memory chips in unused space at the Chinese site. As per the report, the company is linking its plans for a new NAND factory in the US to its ability to increase production in China.The development comes as the Trump administration pushes foreign semiconductor companies to establish manufacturing facilities in America, while Washington continues to restrict China’s access to advanced chipmaking technology.
Why SK Hynix wants US approval for its China facility
Solidigm wants to install additional equipment at SK Hynix’s Dalian facility to manufacture NAND flash memory chips. These chips power solid-state drives (SSDs), which are increasingly important for data centres supporting artificial intelligence (AI) and cloud computing workloads.The Dalian facility already uses semiconductor manufacturing equipment supplied by US companies, including Lam Research, Applied Materials and KLA. However, Solidigm needs additional authorisation to purchase and install more US-made equipment at the site.The report cited one person familiar with the matter, who said the company believes increasing production in China would help Solidigm finance a NAND manufacturing facility in the US. It would also help pave the way for expanding production capacity in America.In a statement to Reuters, SK Hynix said, "The installation of equipment for Mod B is being carried out in close consultation with and under authorisation from the US government."The company added, "No capacity expansion is being sought for the Dalian Mod B, which was completed in 2023."Solidigm declined to comment, while the US Department of Commerce did not respond to a request for comment.
US export restrictions complicate SK Hynix’s plans
The request comes as Washington works to limit China’s access to semiconductor manufacturing technology. The US government has imposed export restrictions on chipmaking equipment to slow Beijing’s development of advanced semiconductors used in AI and military applications.Last year, the US Department of Commerce revoked authorisations that had allowed SK Hynix and Samsung to obtain US equipment for their Chinese factories without applying for individual licences. The department described the previous arrangements as a "Biden-era loophole."Instead, the government said it would issue export licences allowing the companies to operate their existing Chinese facilities, while signalling that it did not expect to approve applications for capacity expansion or technology upgrades.In December 2025, the department issued a licence for SK Hynix’s Dalian plant for 2026 but restricted the amount of equipment that could be exported. One source said the company has not yet been approved for more US-made equipment and technology for 2027.Mod B is a manufacturing facility in Dalian, built in 2023. Even after the memory market went into the doldrums, the equipment was not installed.
SK Hynix’s plans for a US factory
The proposed American NAND factory is part of SK Hynix’s broader efforts to expand its manufacturing presence in the US. Reuters reported last month that Solidigm was considering building a NAND flash memory factory in the country.The company is also reportedly in talks with Intel to lease part of its planned chipmaking facility in Ohio. Separately, SK Hynix has broken ground on an advanced packaging plant in Indiana focused on high-bandwidth memory (HBM), which is used in AI systems.Building semiconductor fabrication plants, commonly called fabs, requires billions of dollars and can take several years. Another source said that Solidigm is also weighing an initial public offering (IPO) as early as next year, which could provide additional funding for its US factory plans.
NAND memory market drives expansion plans
SK Hynix’s request comes after the NAND market has recovered from a previous downturn and struggled with supply constraints. Walt Coon, memory industry expert at TechInsights, said NAND pricing has surged sevenfold since mid-2023 and the market is likely to remain tight over the next few years.The company is one of the two leading global suppliers of NAND flash memory, alongside Samsung Electronics. However, China's YMTC moved up to third place in the second quarter of 2026, according to Counterpoint Research.
