26 February 2026
Mainland China’s DRAM push – a solution to the global supply crisis?
Article Summary
AI-driven DRAM shortages strain automakers. Can mainland China’s CXMT and YMTC expansion relieve supply pressure and pricing risk?
The automotive industry’s pivot toward software‑defined vehicles, electrification and AI‑enhanced architectures, has transformed memory from a commodity line item into a critical strategic bottleneck. Over the past year, DRAM supply dynamics—shaped by AI data‑center demand and wafer reallocations—have begun reshaping the risk landscape for vehicle programs worldwide. For OEMs and Tier‑1s, understanding how global DRAM moves, particularly with rising mainland Chinese players, has become a core part of ensuring product continuity, competitiveness and long‑term resilience.
The first quarter of 2026 opened with renewed concerns about a shortage of DRAM for automotive applications. Memory manufacturers have been reallocating wafer capacity toward high-bandwidth memory (HBM) for AI data centers, where demand and margins are rising fastest. This reallocation tightened supply for traditional automotive DRAM, leaving vehicle makers exposed to constrained inventories and rising competition for limited fab capacity.
A small number of firms dominate global DRAM production, and changes in their wafer-allocation priorities quickly ripple across downstream industries. Currently, Samsung Electronics, SK Hynix and Micron Technology together hold over 90% of the global DRAM market. This level of concentration means that allocations toward HBM or other high-value segments can immediately squeeze automotive supply and affect pricing, product roadmaps and launch schedules.
Amid concerns over potential supply shortages, some customers are placing inflated orders for DRAM as a precautionary measure, effectively building buffer inventory to secure allocation and mitigate the risk of disruption. This, in turn, is artificially amplifying short-term DRAM demand and adding further pressure to an already constrained supply environment.
Mainland China’s rising contenders: CXMT, YMTC scale up DRAM and HBM output
Mainland China’s memory players have accelerated technology development and capacity expansion to capture a larger share of the global DRAM and NAND markets. Two names to watch are ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies (YMTC).
At the China International Semiconductor Expo 2025 (IC China 2025) exhibition, CXMT unveiled a slate of high-end DRAM products including DDR5 and LPDDR5X modules, claiming performance that approaches incumbent suppliers. Public product specifications indicate DDR5 speeds near 8,000 Mbps and chip densities of 24 Gb per part, which would position CXMT closer to the latest offerings from South Korean peers. CXMT is also rapidly expanding its Shanghai fab, aiming for two to three times the capacity of Hefei headquarters. The facility will make DRAM for servers, personal computers (PCs) and electronics, including automotive, with equipment installation in late 2026 and mass production starting in 2027.
CXMT is also pursuing an IPO to raise capital for manufacturing upgrades and research and development (R&D). In December last year, it filed for an initial public offering (IPO) seeking to raise 29.5 billion yuan (approx. $4.2 billion) in Shanghai, as it looks to upgrade production lines and expand the development of advanced memory technologies. According to filings, proceeds will be directed to process improvements and next-generation DRAM development.
YMTC, historically focused on NAND flash, is simultaneously expanding and diversifying. Its Wuhan campus plans include a new facility where an estimated half of production will target DRAM.
Blacklist reversal of CXMT and YMTC by the US could ease DRAM pressure
Pentagon's brief blacklist reversal could ease US OEM access to mainland Chinese memory suppliers. The document, which briefly appeared in the Federal Register and named several mainland Chinese companies linked to the People's Liberation Army, was withdrawn on Feb. 13, 2026, at the request of unidentified government bodies.
Major technology companies Alibaba, Baidu and BYD were included in that update, while memory chipmakers YMTC and CXMT were removed. The updated list is expected in the coming weeks.
The removal of YMTC and CXMT from the latest US Defense Department’s blacklist could improve sourcing flexibility for American OEMs that had previously avoided mainland Chinese memory over political and regulatory concerns.
Amid strong AI-driven memory demand, major PC manufacturers including HP, Dell, Acer and Asus are evaluating initial purchases from mainland Chinese suppliers as capacity expands.
What does it mean for the automotive sector?
In the short term, mainland Chinese DRAM output is more likely to be absorbed by high-volume segments such as consumer electronics, smartphones and selected industrial applications and potentially portions of the AI-driven data center market.
If players such as CXMT continue gaining share in domestic and broader Asian consumer markets, incumbent leaders Samsung Electronics, SK Hynix and Micron Technology may gradually lose volume in mainland China. This displacement effect can indirectly release wafer capacity at established suppliers, easing allocation pressure for automotive-grade DRAM.
S&P Global Mobility data indicates that CXMT’s share has increased significantly since 2020, supported by aggressive capacity expansion and strong policy backing from the government. Mainland China accounted for approximately 30% of SK Hynix’s revenue in 2024, and this exposure is now declining under competitive pressure from domestic suppliers.
S&P Global Mobility expects that the first effect of mainland Chinese DRAM expansion will remain within mainland China. Local OEMs and electronics companies are already increasing purchases from domestic suppliers. Over time, as mainland Chinese suppliers expand exports into Asia and Europe, global DRAM pricing could become more competitive. This could improve availability for automotive programs outside the US market. According to S&P Global Mobility’s discussion with clients, American DRAM customers are also evaluating mainland Chinese suppliers as potential alternatives. For vehicles sold in the US, sourcing may remain sensitive. However, for markets targeting Asia and Europe, there is greater openness to diversification.
The recent scrutiny around Nexperia strengthened the view that Western OEMs were trying to reduce dependency on mainland Chinese semiconductor suppliers. Companies such as General Motors (GM) have taken steps to rebalance sourcing strategies. However, the current DRAM shortage is changing priorities. When supply becomes tight, ensuring continuity becomes more important than reducing exposure. OEMs, Tier-1 suppliers and semiconductor vendors are now actively evaluating mainland Chinese DRAM suppliers, especially for vehicles not destined for the US market.
Currently, CXMT does not offer AEC-Q100-qualified automotive DRAM. However, given mainland China’s broader semiconductor strategy and the company’s accelerated roadmap execution, automotive-grade development is a logical next step. S&P Global data suggests that meaningful automotive input is unlikely before 2028. Even so, preparatory ecosystem engagement and technology groundwork are likely already under way. If mainland Chinese suppliers enter the automotive DRAM segment later in the decade, pricing dynamics, sourcing diversification and competitive positioning would shift materially.
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This article was published by S&P Global Mobility and not by S&P Global Ratings, which is a separately managed division of S&P Global.