SMIC To Remain On The 7nm Lithography Until At Least 2026, Limiting Huawei’s Advancement, Despite Receiving A Near-Unlimited Budget From The Government

Earlier this year, Huawei and SMIC achieved a new milestone by successfully developing the 5nm technology, but given that the wafers on this lithography will be mass produced using the older DUV machinery, China’s largest foundry will undoubtedly be running to yield issues. Sadly, this problem extends to the 7nm process too, which TSMC adopted in 2018, meaning that SMIC is multiple generations behind the competition. A new report states that despite receiving a massive budget from the Chinese government, the chip manufacturer cannot scale the 7nm barrier, meaning that Huawei will be stuck using this technology until at least 2026.

Previous rumor claimed that Huawei will use a 6nm chipset for its Mate 70 family, but it is likely just an improved iteration of the 7nm process with a different name

Recently, it was revealed that Huawei’s AI chip ambitions were pushed behind by three generations due to additional trade sanctions placed by the U.S. If things were not bad enough, TSMC recently notified several Chinese customers that they would no longer receive 7nm chip shipments for various applications, and it was later revealed that this order came from the U.S. authorities. With China’s options reduced to nearly zero, the only alternative is to rely on its foundry entities like SMIC to achieve dependency from the likes of TSMC and Samsung. Sadly, there are roadblocks to that progress too.

With ASML, the only company in the world to supply advanced EUV equipment to wafer manufacturers like TSMC and Samsung, barred by the U.S. from selling this cutting-edge machinery to SMIC, the latter’s only option is to use what it currently possesses. The Chinese government likely allocates a massive budget to aid the foundry in developing its own EUV equipment, but it will probably take several years to realize that goal. According to the Liberty Times, people familiar with SMIC’s and Huawei’s plans said both companies will be stuck with the aging 7nm process until at least 2026.

The situation is even worse when you realize that even with the existing machinery, SMIC continues to struggle with 7nm yields, meaning that producing 5nm wafers at this point would be counterproductive and result in a meaningless loss of funds. Huawei was recently reported to introduce the new Kirin 9100 for the upcoming Mate 70 family, and it was said to be mass produced on the 6nm process, along with sporting a new CPU cluster. However, it appears that this 6nm lithography could just be an improved iteration of the 7nm technology with an increased transistor count and nothing else.

In short, Huawei’s salvation lies in SMIC getting its act together and working with a singular goal to achieve a healthy yield for its advanced manufacturing process. With the budget allocated by the Chinese government, we believe it should be possible unless there is something else going on behind closed doors that we are unaware of.

News Source: Liberty Times