Huawei is expanding its role in China’s semiconductor self-reliance drive by coordinating development of domestic deep ultraviolet (DUV) lithography equipment, the industry’s most technically demanding segment beyond chip design and fabrication. U-Precision, a Shanghai startup established in 2022, has co-developed an advanced DUV system now undergoing tests at Semiconductor Manufacturing International Corp. (SMIC), other Chinese chipmakers and Huawei production lines. The company plans to produce 12 units by the end of 2026, although some prototypes still use foreign components, including projection lenses reportedly supplied by Germany’s Zeiss. Huawei’s Hubble venture arm and Shenzhen Yuanzhi Xinghuo have invested in Chinese developers of projection optics and high-power light sources, including Fujian Zichi Photonics and Beijing RS Laser Optoelectronics. A separate earlier account identified Shanghai Yuliangsheng as the project’s lead equipment maker, while a late-July Reuters report said the state-owned Shanghai IC R&D Center was integrating the U-Precision and Shanghai Micro Electronics Equipment teams, with targets of about five units in 2026 and 20 in 2027. The effort is intended to support advanced artificial intelligence chip production and eventually reduce reliance on ASML, although Chinese foundries still depend heavily on ASML systems and U-Precision’s equipment faces years of validation before reaching comparable productivity. Huawei is also targeting roughly 600,000 Ascend 910C accelerators in 2026, while DeepSeek has ordered at least 160,000 Ascend 950DT chips for a planned 1-gigawatt data center.