According to Reuters reports, people familiar with the matter revealed that in the face of more restrictions that the United States may offer, Huawei is gradually shifting the production of internally designed chips from TSMC to SMIC.
Earlier reports said that the US government will expand its pressure and adopt stricter rules on Huawei ’s shipments to companies. It may reduce the limit of technology derived from the US technology to 10%. In addition, the US is considering revising the “Foreign Direct Product Rules” , Stipulates that foreign companies that use US chip manufacturing equipment need to obtain a US license before supplying chips to Huawei, so as to restrict TSMC from manufacturing chips for Huawei.
In order to circumvent US restrictions, one of the sources said that Huawei ’s chip division HiSilicon began requiring some engineers to design chips for SMIC instead of TSMC at the end of 2019, and said that Huawei has gradually switched to SMIC. International to speed up the production process.
In a statement to Reuters, a Huawei spokesperson called this transformation "industry practice": "Huawei will carefully consider capacity, technology and delivery issues when choosing a semiconductor manufacturing plant." In addition, Huawei also said that South Korean companies , Chinese Taiwanese companies and Chinese mainland companies can be used as alternative sources.
Neither TSMC nor SMIC commented on this.
According to analyst estimates, by the end of 2019, Huawei has accounted for 13% to 15% of TSMC's sales. In addition, the chip output that can be transferred to SMIC may only account for 1% -3% of chip output.
Experts said that only TSMC can produce HiSilicon's latest Kirin processor (only used in Huawei mobile phones), and earlier Kirin processors can be outsourced to SMIC. In addition, other chips produced by HiSilicon, such as those used in IoT devices, power management or set-top boxes, can be handed over to SMIC.
Industry insiders also pointed out that under the extreme pressure of the United States, SMIC may benefit. "If TSMC is suppressed, it will allow SMIC to develop rapidly, which is a brain remnant option that the United States will never choose. TSMC will also use the rapid development of SMIC technology to warn the United States that this matter is not something I can control. Things will be very different this year. On the one hand, SMIC ’s technology will continue to break through. On the other hand, the percentage of U.S. technology used in TSMC ’s 5nm process will continue to decline rapidly, ”the industry insider said.
