AI chip race: China ramps up 7nm production amid self-sufficiency push to rival US

China’s Hua Hong Group has developed advanced chip manufacturing technologies, aiming to produce AI chips and boost Beijing’s tech self-sufficiency as the competition with the US heats up.

According to Reuters, Huali Microelectronics, the contract chipmaking arm of the Hua Hong Group, is preparing to launch a 7-nanometer (nm) production process at its Shanghai facility.

This development positions Hua Hong to become only the second domestic chipmaker capable of producing chips at such an advanced node.

Currently, China’s SMIC is the only domestic producer capable of making chips with 7nm technologies.

Huawei is reportedly a primary partner in this 7nm development, providing technical collaboration to Huali bridge the gap to advanced nodes.

According to sources privy to the matter, Huali aims for a production capacity of a few thousand wafers per month by the end of this year. Later, the chipmaker company will go for a larger ramp-up.

The Chinese GPU designer Biren is using Huali’s 7 nm line for "tape-out" (prototyping). This is a vital lifeline for Biren after it was blacklisted by the U.S. and lost access to TSMC, sources said.

The development comes after the Trump administration decided to ease some restrictions on chip exports, allowing Nvidia to sell only its second-most powerful AI chips to China.

Given its self-reliance push, China is encouraging the domestic firms to use homegrown chips to reduce dependency on foreign suppliers.

The Hua Hong Fab 6 is considered one of the most advanced of seven foundries and is currently known for manufacturing logic chips using 22 nm and 28 nm process nodes.