Koreans have a big problem. It’s all China’s fault
The Chinese are aggressively pushing into another market. Price fighting is being used again to strangle competition. And it brings results.
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As reported by DigiTimes, Chinese producers DRAM memory they are intensively increasing production and aggressively reducing prices. Companies like Changxin Memory and FujianJinhua they are already selling their dice much cheaper than South Korean companies. In some cases, their memories are even cheaper than the chips used.
There are plans to modernize factories in Hefei and Beijing
CXMT increased its production capacity from 70,000 silicon wafers per month in 2022 to 200,000 wafers per month in 2024. However, this is not the end, as further plans assume 300,000 wafers per month. The goal is gaining 11% share in the global DRAM market.
As a result oversupply of DDR4 memory led to fierce price competition. Chinese manufacturers offer prices up to 50% lower than Micron, Samsung and SK hynix and 5% lower than refurbished aftermarket chips. However, enterprise customers remain cautious about using Chinese DRAM.
In response to intense price pressure, Korean companies are reducing DDR4 production and shifting to memory DDR5 and HBM3. These are systems that Chinese manufacturers are currently unable to mass produce. This step is expected to stabilize the market situation.
The Chinese government actively supports this DRAM expansion through subsidies. This support allows Chinese manufacturers to offer highly competitive prices without worrying about immediate profitability and focus on establishing dominance in both local and international markets.
There are also reports about indirect entry of Chinese companies into the Indian marketwhich would allow it to bypass Western sanctions and take advantage of partnerships with Taiwanese brands. It would also have image advantages, allowing it to reach consumers and companies that deliberately avoid Chinese solutions.
