After NAND rose 70% in a single quarter, SK Hynix restarts Dalian Phase 2, speeding up competition with Samsung Xi'an.

According to TrendForce, SK Hynix plans to resume its previously shelved Phase 2 expansion project at the Dalian plant in the second half of 2026, adding a V8 (238-layer) NAND production line. The project was previously suspended due to the sluggish NAND market and U.S. export controls. The restart signals that the company is turning the historic recovery in NAND prices into actual capacity deployment.

According to a report by News Tomato**, SK Hynix will begin installing production equipment at the Dalian Phase 2 facility in the second half of this year, with construction to be completed in phases by the first half of 2027. **Domestic partners have already begun transferring idle NAND equipment to Dalian, and overseas suppliers have reportedly received initial purchase orders for equipment delivery.

Sisa Journal further disclosed capacity details: Dalian Phase 2 will add one V8 production line (238 layers) with a monthly target capacity of 30k to 50k wafers. Dalian Phase 1 is currently undergoing a deep conversion to 192-layer NAND production and replacing aging equipment.

The Turning Point Behind the Shelving: From Export Controls to Annual Approvals

The Dalian Phase 2 expansion had previously stalled due to two factors: uncertainty over U.S. semiconductor equipment export controls to China, and the prolonged downturn in the NAND market.

On the regulatory front, a key variable has changed. According to a News Tomato report, the U.S. has adjusted its previous "Validated End User" (VEU) system to an annual approval process for equipment shipments, thereby easing uncertainty over equipment supply and giving SK Hynix the operational room to restart the Dalian expansion.

The timing of this regulatory change is worth noting. Against this backdrop, the market is watching whether SK Hynix can leverage the boom in DRAM and HBM to further unlock the value of its 11 trillion won (approximately $8 billion) acquisition of Intel's NAND business through the Dalian expansion. The report pointed out that Dalian Phase 2 is considered the fastest-expanding site among SK Hynix’s NAND production bases.

Industry Background of the V8 Production Line: NAND Prices Hit Historical Peaks

The timing of the expansion restart is no coincidence. In Q1 2026, SK Hynix’s average NAND selling price rose more than 70% quarter-on-quarter, setting a single-quarter record. The company’s Q2 guidance further clarified that NAND shipment volumes will "turn from decline to growth," rebounding quarter-on-quarter. The dual improvement in price and shipment volume provided the decision-making basis for restarting the previously shelved capital expenditure plan.

Data from The Korea Times shows that SK Hynix’s investment in its Dalian NAND manufacturing subsidiary in 2025 has increased to 440.6 billion won, up 52% year-on-year—even before the Phase 2 expansion officially restarted, the company had already accelerated its spending on NAND.

On the technology roadmap, SK Hynix has completed production verification of 375-layer 3D NAND flash memory, with mass production planned at its Cheongju M15 plant by the end of this year. The Dalian V8 (238-layer) line forms a technological gradient with this, serving different market positions.

Competition Heats Up: Samsung’s Xi’an Plant Accelerates Simultaneously

SK Hynix is not the only memory giant expanding NAND capacity in China. A report from Sisa Journal shows that Samsung Electronics is also accelerating the NAND upgrade at its Xi’an plant. Samsung completed the conversion of its production line from 128-layer V6 to 236-layer V8 on March 30 and is now entering the mass production phase.

Investment data confirms this trend. According to Sisa Journal estimates, Samsung’s investment in its Xi’an NAND plant in 2025 is approximately $304 million, up about 67.5% year-on-year. The simultaneous expansion of NAND capacity in China by South Korea’s two major memory giants means that global NAND supply is shifting from a contraction cycle to an expansion track.

From a timing perspective, Samsung’s Xi’an V8 mass production has already begun, while SK Hynix’s Dalian Phase 2 V8 equipment installation is expected to start in the second half of the year, resulting in a gap of several quarters between the two in terms of actual capacity release pace.

Risk Warning and Disclaimer

        Market risk: investment requires caution. This article does not constitute personal investment advice, nor does it consider the specific investment objectives, financial situation, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article are suitable for their particular circumstances. Any investment based on this is at your own risk.