Crazy Storage Chips: 100% Increase Outperforms Gold Who Took the Money from Cars?

Stock trading is all about following research reports from the Golden Kirin analysts—authoritative, professional, timely, and comprehensive. Help you uncover potential themes and investment opportunities!

So far this year, perhaps there hasn’t been a crazier market than memory chips.

“After the Spring Festival, attention across the whole market has been on automotive-grade chips.” Several automotive-grade memory chip distributors told the reporter from 21st Century Economic Herald, “After one round of gains, the market has to digest it. Once prices hold steady, the next round of price hikes will come from the terminal market.”

The memory chip price-hike cycle has nearly lasted a year, and the uptrend is still continuing. Some terminal-market insiders revealed that, taking Samsung’s 8GB eMMC chip as an example, the quote was about $50 (about RMB 346 yuan) before the year, and afterward it had climbed to about $100 (about RMB 693 yuan), doubling the price. The chip is mainly used in smart cockpit scenarios such as in-car infotainment systems and digital instrument clusters. Another chip distributor confirmed this fluctuation to the reporter: after the year, automotive-grade chips went crazy with price hikes; many smaller distributors could no longer get spot inventory.

This round of memory chip price increases is crazier than gold—often described as “digital gold.” Goldman Sachs previously projected that the gold price would rise 17% from the January 2026 average to the end of 2026; compared with that, gold looks “much milder” instead.

Research reports from multiple institutions such as HSBC and UBS have mentioned that, by itself, just the memory chip price increase could lead to an additional RMB 1,000 to RMB 3,000 per car in cost. When combined with the market’s forecast that battery costs per car will rise another RMB 3,000 to RMB 5,000, the total cost per car will expand further.

Cost pressure has already begun to flow through to the terminal. In March, Xingtu ET5 high-end models announced a RMB 5,000 price increase, becoming the first publicly announced price hike since the beginning of this year; BYD Sealion 06EV increased its price by RMB 6,000 while upgrading its configuration. More automakers have chosen to absorb internally: Li Auto, Zeekr, and suppliers such as Micron signed long-term agreements to lock in prices, while Chery achieved cost reduction through “aluminum-to-copper replacement” in wiring harnesses.

The current round of price hikes has been jointly driven by supply-demand conditions, structural capacity adjustments by OEMs, and fluctuations in market sentiment.

During this super cycle, automobiles are already somewhat special. On the one hand, overall demand volumes are relatively small; on the other hand, automakers with larger demand volumes will sign contracts directly with chip manufacturers to reduce the impact of price fluctuations on costs, to a certain extent not participating in digesting the “crazy” cost hikes in part of the market. However, not every automaker has such leverage.

One hour, one price—the spot market becomes a “wild exchange”

A smart vehicle carries thousands, even tens of thousands of chips. From powertrain control and body electronics to smart cockpits and autonomous driving, every functional module depends on them. Memory chips are only a small part of that, yet they bear the vehicle’s entire “memory and thinking.”

According to TrendForce data, in the fourth quarter of 2025, more than 90% of the global DRAM market (dynamic random-access memory—i.e., operating memory for electronic devices) was dominated by three giants: Samsung, SK hynix, and Micron.

As assisted driving fully enters the end-to-end large model stage, demand for memory chips in smart vehicles is becoming increasingly large.

“Memory Old K,” a chip distributor, has been in this industry for more than two years and has fully witnessed the rise in this market. He told the reporter from 21st Century Economic Herald that LPDDR and NAND Flash are currently the two product categories with the most concentrated demand. The former is a low-power version of DRAM (dynamic random-access memory) and has become standard in smart cockpits; the latter is responsible for storing data such as navigation, entertainment, and logs.

Multiple chip distributors told the reporter that the price of automotive-grade memory chips has started to rise noticeably since after the Spring Festival this year. “Memory Old K” observed that, taking Samsung’s eMMC chip used for smart cockpits as an example, the quote was $50 before the year and has climbed to $100 after the year.

Meanwhile, in the spot market, some distributors describe it as a “wild exchange.” Prices change at any time. There is no unified posted price and no stable supply channels. Distributors use phrases like “a price every half day, even a price every hour” to describe the rhythm right now.

“Automotive-grade memory chips—at least for now—they’re still going up, because there’s still a shortage of supply in the market.” A memory chip agent in East China told the reporter from 21st Century Economic Herald.

Choi Tae-won, chairman of South Korea’s SK Group, said at NVIDIA’s GTC conference held in San Jose, California, that due to systemic bottlenecks in chip production, he expects the global memory chip shortage situation is very likely to continue until 2030.

“Surfing the incoming tide” during the price hikes—who takes the risk, who profits?

For a single automotive-grade memory chip to go from the original manufacturer to the terminal, it has to pass through authorized agents, distributors, and then Tier 1—only then can it ultimately flow to automakers. Only the leading automakers with sufficiently large demand volumes can bypass this layered chain and sign long-term supply agreements directly with Samsung, Micron, and SK hynix.

On the memory chip price-hike chain, each layer keeps its own books. How profits are allocated is another game altogether.

Chip original manufacturers take the largest slice of the cake and send multiple price-hike letters to the market. Original manufacturers generally adopt a quarterly pricing model to keep pricing adjustments flexible.

Public information shows that in the first quarter of 2026, Samsung and SK hynix will raise server DRAM prices by 60% to 70% compared with the previous quarter. PC and mobile DRAM will follow suit, and Micron has also joined the price-hike group.

AI demand is reshaping the logic behind capacity allocation. SK hynix’s 2026 HBM (high-bandwidth memory) capacity was fully pre-sold at the end of 2025 to core customers such as NVIDIA and AMD.

Agents and distributors within the chip distribution system are also “surfing the incoming tide” in the wave of chip price hikes, hoping to make a big profit on the opportunity. Their survival rules are that they need to stock up in advance—buy and hold inventory. A distributor told the reporter that popular automotive-grade chips now require waiting for 3 to 6 months. But the OEMs hardly place orders; they only take spot inventory. “I have a customer OEM. I know they will use this memory chip, and I also more or less know their production plan, so I’ll help them prepare it in advance—so that when they need it, they can get it immediately.” “Memory Old K” said that now everyone avoids futures, because nobody can be sure about what will happen six months later—so it is relatively uncontrollable.

Authorized agents sit in the middle of the chain. They purchase from the original manufacturer and sell to downstream at a markup; long-term agreements lock in most of the allocations.

Risk and opportunity go hand in hand. Even though agents appear to have more say, once they step onto the path of stockpiling and trading-for-profit, they realize the risks involved.

An industry insider explained: “Authorized agents need to order directly from the original manufacturer. If they don’t place orders, it will affect their qualification as agents downstream. So even if prices fall, the agent has to grit their teeth and eat up that batch of inventory.”

Downstream of agents, distributors usually purchase from agents or pull orders from the spot market, then resell to Tier 1 suppliers with demand or to peers. But at the same time, stockpiling inventory at high prices may also face the risk of price drops, and customer breaches could happen at any time.

Further down the chain, OEMs ask suppliers to help place orders, and suppliers sometimes also have to bear the receivables/credit period.

As the wheels keep turning faster, risks are pushed down layer by layer, and what ultimately gets pressed onto automakers is not only the price, but also the uncertainty across the entire chain.

TrendForce analyst Chen Hongyan noted a change. She told the reporter from 21st Century Economic Herald that although memory chips do not account for a very high proportion of the BOM cost of a whole vehicle, the sharp and sustained nature of this round of price hikes is becoming a core variable that squeezes automakers’ profits.

Perhaps in this game, the party bearing the biggest risk of paying the bill isn’t only those speculators who become rich overnight—it also includes the suppliers at the very end of the chain, especially small players with limited funds and a single customer. They have neither the original manufacturers’ allocation protection nor automakers’ long-term agreements as a safety net, so they can only passively endure between price ups and downs.

The automakers’ choices

The chip shortage of 2021 made the global automotive industry experience for the first time the power of semiconductors firsthand. That year taught automakers to “fight for” everything—snatch capacity, snatch allocations, snatch every chip they could buy. Lotus Auto CEO Feng Qingfeng said that at the time Lotus was facing difficulties delivering new cars, plus chips were in short supply; to secure chips, he made six trips to the United States.

And now memory chips are rising again. In a January livestream, Deepal Auto chairman Deng Chenghao said that due to increases in both power batteries and in-car storage chips, the manufacturing cost per Deepal car had increased by several thousand yuan compared with before. Not long after saying that, he announced that several of the company’s key models would offer purchase subsidies of up to RMB 10,000. Even with several thousand yuan of pressure added to the books, automakers still dare not change prices lightly.

Chen Hongyan believes that for automakers, the top priority right now is to ensure supply and keep stable production schedules.

Unlike price hikes, Tesla chose a more asset-heavy route. On March 30, Tesla officially announced the launch of the TERAFAB super chip factory project, integrating logic chips, memory, and packaging. Musk called it “the most grand chip manufacturing project in history.” Analysts at Barclays previously estimated related spending would reach $50 billion, but some also believe actual spending could be several times higher. Musk believes that even if all capacity from all mainstream memory chip suppliers is included, it would still not be enough to fill Tesla’s demand.

Chen Hongyan reminds that a chip factory requires extremely large scale and very high technical thresholds; what is invested is real money and top talent. The other side of high returns is high risk.

Most automakers don’t have Tesla’s financial strength and ambition. They choose another way. For example, Micron has reached direct supply cooperation with Li Auto and Zeekr; Samsung signed direct supply agreements with Volkswagen and Hyundai; and SK hynix supplies automotive-grade HBM for Waymo. Li Auto’s vice president of supply chain, Meng Qingpeng, disclosed that in response to tight memory chip supply, the company has already locked in allocations in advance. These automakers exchanged the certainty of long-term procurement for priority in supply.

For most automakers, this is still the most economically reasonable choice at the current stage.

But ultimately, the pressure of rising costs still falls on the OEMs. “It doesn’t matter who you sign with now—the price hikes will have to be passed through across the board. This is an irresistible market environment.” An executive for intelligent driving at an OEM said, “In any case, actual vehicle costs are rising.”

As for whether this round of price hikes will ultimately show up in car prices, Chen Hongyan thinks it’s still unknown. Cars are high-priced durable goods, and pricing strategy is far more complicated than consumer electronics. Frequent price adjustments damage brand image and affect resale values. With domestic market growth slowing this year, subsidies being reduced, and the purchase tax incentive cut in half, consumers’ burden of buying cars has already been increasing. For automakers to maintain sales in a stock market environment of competition, it’s hard to easily pass costs on to users.

Unable to withstand the pressure, the supply chain is being forced to look for new solutions. An employee at an intelligent driving company revealed that internally, the company is discussing domestic substitution options.

In January 2026, Zhaoyi Innovation and Chery signed a strategic cooperation agreement, focusing on coordinated innovation between automotive-grade chips and next-generation E/E architecture, covering smart cockpits and autonomous driving. The main businesses of Zhaoyi Innovation include three core layouts: memory, MCU, and analog. Zhaoyi Innovation claims that its cumulative shipments of automotive-grade memory chips have already exceeded 300 million units. Changxin Memory’s LPDDR5 chips have also completed automotive-grade certification, and are compatible with customers such as Tesla and BYD.

However, domestic manufacturers still hold less than 5% share in the global automotive-grade memory chip market. The monopolistic pattern among Samsung, SK hynix, and Micron shows no signs of being broken in the short term.

TrendForce expects that in 2026, DRAM industry capital expenditures will be about $61.3 billion, up about 14% year over year, far below the 30% to 50% growth rates typical of historical expansion cycles. Samsung’s expected DRAM capacity growth in 2026 is only about 5%, creating a sharp contrast with market demand growth.

Caution on the supply side comes partly from uncertainty on the demand side.

On March 25, Google released TurboQuant technology, which is said to reduce large-model runtime cache memory usage by more than 6 times. After the news broke, SK hynix’s stock price fell by as much as 6% at one point, and Micron subsequently fell by nearly 7%. However, Morgan Stanley pointed out that this technology targets only KV cache, and the AI model context window is growing at a rate of 30x per year, far exceeding the incremental benefit from compression. JPMorgan cited the “Jevons paradox”: technological progress increases efficiency, but often does not reduce consumption; instead, it stimulates a surge in demand. Some distributors told the reporter from 21st Century Economic Herald that the impact of this news is mainly concentrated at the stock-price level, and that there is no obvious real transmission to the spot market at present.

For chip original manufacturers, the real risk is not a particular technical breakthrough, but the long-term visibility of demand. Cloud computing companies’ investment pacing is driven by macroeconomics and capital markets—nobody knows when the AI investment boom will hit the brakes.

The dilemma of capacity expansion is like an unsolvable paradox for chip original manufacturers. For the auto industry, this round of price-hike cycle may not be over yet.

(Author: Jiao Wenjuan; Editor: Wu Xiaoyu, Zhang Mingyan)

 Open a futures trading account on Sina’s partnered large platform—safe, fast, and reliable

A massive amount of news and precise analysis—right here in the Sina Finance APP

Responsible editor: Yang Ci