China Reportedly Tests First Domestically-Made DUV Lithography Machine for AI Chip Production
A recent report has revealed that China's leading semiconductor manufacturer is conducting trials on the country's first domestically produced advanced chipmaking equipment, marking a significant step in Beijing's efforts to reduce dependence on Western technology and overcome U.S. export restrictions.
According to the Financial Times' report published on September 17, 2025, Semiconductor Manufacturing International Corporation (SMIC) is testing a deep-ultraviolet (DUV) lithography machine manufactured by Shanghai-based startup Yuliangsheng.
The development represents a potential breakthrough in China's semiconductor independence strategy. The ability to produce advanced DUV machines domestically could help Chinese chipmakers overcome U.S. export controls that have limited access to equipment from ASML, the Dutch company that dominates the advanced lithography market. Currently, Chinese chip manufacturers rely primarily on ASML devices purchased before export restrictions took effect or acquired second-hand from other countries.
Industry analysts view the development cautiously but recognize its strategic importance. Lin Qingyuan, a semiconductor analyst at Bernstein, noted that if successful, this would represent an important step for Chinese companies to build upon for more advanced machinery development.
The testing involves a 28-nanometer Chinese-made DUV lithography machine that uses multi-patterning techniques to produce 7nm chips. While most components in Yuliangsheng's machine are manufactured domestically, some parts are still sourced internationally, though efforts are underway to achieve complete domestic production.
However, significant challenges remain. The machines being tested could potentially produce 5nm processors at lower yields but cannot match the capabilities of extreme ultraviolet (EUV) equipment used by industry leaders like Taiwan Semiconductor Manufacturing Corporation (TSMC) for cutting-edge 2nm chips.
The report indicates that Chinese chipmakers, led by SMIC, are planning to triple their output by 2026, with domestic tools potentially entering mass production as early as 2027. This timeline suggests China's semiconductor self-sufficiency efforts may require several more years before achieving commercial viability and competitiveness with established Western manufacturers.