China is working on a new tank design, one that will replace their current M-1 killer, the Type 99A2. According to the director of the China North Vehicle Research Institute, their next generation tank will be smaller and lighter than the 60 ton Type 99A2. The new tank will have a crew of two and rely on missiles as its main weapon. The new tank will have many more sensors and an active defense (small missiles taking out incoming anti-tank missiles). The sensors will enable the two man crew to see what is all around them, and be connected electronically with other tanks, and units, in the area. This enables a "Battle Management System" to provide the tank with good awareness of what's going on around it, and makes it possible to find and destroy targets quickly.
Meanwhile, two years ago, China completed development of the new version of its Type 99 tank, the Type 99A2. This model has improved reactive armor, as well as fixes to the engine, electronics and mechanical components. This is China's most powerful tank, and is based on the Russian T-80 (which is itself based on the T-72).
A lot of Chinese believe that, on paper, it's new Type 99 tank is a match for the American M-1. For protection, the Type 99 has 500-600mm or armor, plus two layers of reactive army, giving it the equivalent of 1,000-1,200mm of armor. China believes the maximum penetration of the M-1 120mm gun is 810mm. China believes that the protection on the M-1 is 600-700mm, and states that the Type 99 main gun can penetrate 850mm (or 950mm with a new shell design.)
However, China has only produced about 400 Type 99s (of all models) so far. There are several reasons for this. First, the cost (about $2 million per tank). This is more than twice as much as other Chinese built tanks cost. There are some practical considerations, as well. The Type 99 is too heavy for many Chinese bridges, not to mention railroad equipment. Most Chinese tanks are closer to 40 tons, while the Type 99 is closer to 60 tons. Nevertheless, the Type 99 continues to get improvements (like an active defense system seen on a few vehicles).
The performance data on the Type 99 (also called the ZTZ-99) is not official. There is very little in the way of official weapons performance data coming out of the Chinese government. At the same time, the Chinese military leaks real, and inflated, data for PR purposes. While China is not a democracy, in this age of the Internet, public opinion can have an influence when the military budget is being put together each year.
Developing the Type 99A2 seems to indicate that more will be produced, or existing ones will be upgraded (or both options may be carried out.) But China seems to believe that developing the new, two man, tank is a better option. This would leapfrog other nations, like the United States, which have thousands of M-1 tanks.