Huawei is gradually shifting chip production from TSMC to SMIC

Chinese manufacturing giant, Huawei, and the U.S. are still at loggerheads over multiple issues. The U.S. has since banned Huawei from dealing with American companies. Of course, it issues a special license to some companies that can work with Huawei. Well, so far, it appears that the effect of the ban is not as hard as the U.S. want. Thus, there are reports that the U.S. will extend the ban to TSMC, a Taiwanese chipmaker. Since TSMC uses some U.S. technology, the U.S. can restrict the quantity of American tech it uses for Huawei's equipment. However, recent reports claim that Huawei is gradually shifting its internal design chip production from TSMC to SMIC. Semiconductor Manufacturing International Corporation (SMIC) is the largest semiconductor foundry in China.

Huawei seems to have Chinese alternative for most of its needs

According to internal sources, Huawei’s chip division, HiSilicon, began instructing some engineers to design chips for SMIC since the end of 2019. The Chinese manufacturer is presently leaning its resources towards SMIC to speed up their help. As of now, we do not know the number of chip production that Huawei wants to divert to SMIC.

According to Huawei's spokesperson, this change is an industry practice. When choosing a semiconductor manufacturer, Huawei will carefully consider issues such as capacity, technology, and delivery. In January this year, Taiwan media reported that Huawei HiSilicon had placed an order to SMIC for a new 14nm chip last year. According to the report, SMIC grabbed the order from TSMC Nanjing Plant. Taiwanese media also claims that SMIC has been developing 14nm since 2015, and successfully started mass production of 14nm FinFET process chips in the third quarter of last year. After the planned production, SMIC's Shanghai plant will build an advanced integrated circuit production line with a monthly capacity of 35,000 pieces.