U.S. tech companies are rushing to book production of 4nm chips at its Arizona fab to avoid paying tariffs.
When the U.S. tightened its export controls in 2020 it blocked Huawei from receiving cutting-edge chips designed by its own HiSilicon unit. Foundries using American chip manufacturing equipment were banned from shipping 5G and other chips to Huawei. After the Mate 40 flagship was released by Huawei in 2020, the company was forced to ship phones using Snapdragon application processors tweaked to work at 4G speeds.
This ended when Huawei turned to SMIC, China’s largest foundry and the third largest in the world after TSMC and Samsung Foundry, to build the 7nm Kirin 9000s for the Mate 60 line. Having SMIC build the application processor allowed Huawei to bring 5G back to its phones without violating the sanctions. One negative for Huawei, its mosr most advanced smartphone chipset is three process nodes behind the competition (5nm, 3nm, and 2nm).
For example, due to sanctions that prevent Chinese firms from obtaining advanced chip manufacturing equipment, Extreme Ultraviolet (EUV) Lithography machines are banned from being shipped to SMIC and other Chinese foundries.
