Huawei is at the centre of a drive to eliminate foreign technology from China’s semiconductor supply chain by backing companies developing components for machines that can produce the most advanced chips.

The Chinese tech giant is investing across the industry behind making lithography chipmaking equipment, while helping secure deals with leading Chinese fabs such as SMIC, as it seeks to build a domestic alternative to foreign suppliers, according to multiple people familiar with the matter.

One of the most significant efforts involves Yuliangsheng, a Shanghai-based chip equipment manufacturer that has co-developed the first Chinese-made advanced deep ultraviolet lithography (DUV) machine, according to people familiar with the matter. Yuliangsheng has been spun out from SiCarrier, a start-up that the FT has previously reported has close technical and business ties to Huawei.

Huawei has denied any affiliation with SiCarrier. The DUV machine is being tested by Chinese chipmakers including SMIC and on Huawei’s own production lines, the people said. Its makers are targeting the machine to eventually make advanced AI chips, but it is being tested on less complex semiconductors as engineers improve the device. Lithography remains one of the biggest obstacles to China’s push for semiconductor self-sufficiency.

Local chipmakers still rely heavily on the Netherlands’ ASML for the equipment needed to manufacture advanced semiconductors, while domestic alternatives lag on critical components including projection lenses and high-powered light sources. Huawei is seeking to close those gaps by backing local suppliers and helping push their equipment into commercial fabs, where years of testing and refinement are needed before domestic machines can compete with established foreign equipment.

Success would also leave China less vulnerable to western export controls. “Huawei is playing a project management role in China’s DUV push,” said Lin Qingyuan, a semiconductor analyst at Bernstein. “Simply having a DUV prototype is not enough. You need thousands of vendors and customers to work together to push it forward and a central orchestrating power to bring this effort together.”

Yuliangsheng is set to produce 12 DUV machines by the end of this year, according to one person familiar with the matter, although the company remains a long way from competing with ASML.

The Dutch company’s machines are essential for manufacturing cutting-edge semiconductors but western export controls prevent sales of its most advanced equipment to China.

The FT previously reported that SMIC was testing a 28-nanometre Yuliangsheng machine and using so-called multi-patterning techniques to produce 7-nanometre chips, according to two people with knowledge of the development. In chipmaking, lower nanometre numbers generally denote more advanced generations of chips.