Widely reported and discussed, but not unequivocally confirmed by the main players, has been recent news that Chinese telecommunications kit giant Huawei has plans to build a chip plant in China to help it sidestep US sanctions.
If it goes ahead, the facility, said to be planned for Shanghai, will help the company to lessen its dependence on American chip-manufacturing and chip-design technology and build up experience in fabricating chips, which it apparently lacks. Ramping up its own chip production would in any case be necessary for the survival of its 5G infrastructure business.
In addition, with US export controls serving to block semiconductor supplies to Huawei, a local facility will be necessary when the company’s existing stockpile of imported chips is used up.
The UK’s Financial Times newspaper cited sources suggesting that the plant would be run by a partner, Shanghai IC R&D Centre, a chip research company backed by the Shanghai municipal government.
Despite the lack of confirmation from Huawei, the FT has learned that the fabrication plant will initially experiment with making low-end 45nm chips, moving on, eventually, to make more advanced 28nm chips and the 20nm chips necessary to Huawei’s 5G telecommunications equipment business.
China has long had ambitions to shake off its dependency on foreign chip technology. This move, if it goes ahead, could force at least one company to go down that route a little earlier than expected.