Chinese manufacturing giant, Huawei, is currently facing a hard time in the smartphone industry due to the U.S. ban. The latest ban stops Huawei from using any American software or technology. This means that its HiSilicon line can no longer be active. Huawei does not do chip manufacturing, it sublets that to TSMC. HiSilicon basically does the chip design. However, TSMC uses American technology to manufacture the Kirin chip. With this ban, TSMC can no longer work for Huawei.
According to recent reports, due to the tightening of US sanctions on Huawei, the company’s fabless chip manufacturing subsidiary HiSilicon is now losing a large number of engineers. “The increasing US trade sanctions are pushing HiSilicon to the brink…Many engineers have already left Huawei’s IC design team in Taiwan“.
Loss of engineers will affect its 45-nanometer chip factory plan
In view of HiSilicon’s recent efforts to dig out talent from Taiwan, China, and other international chip manufacturers, this news is a serious blow. In addition, this will also affect the recently exposed plan of Huawei to build a 45-nanometer fab. According to reports, Huawei, struggling to survive under the US trade ban, is seeking to build its own 45-nanometer chip factory without using US technology. This move was described by industry observers as an “impossible task”. In addition to the 45nm process, Huawei also plans to build a 28nm process production line.
On August 17, the Bureau of Industry and Security (BIS) of the U.S. Department of Commerce issued a revised ban on Huawei. This ban further restricts Huawei’s use of U.S. technology and software products. It als added 38 Huawei subsidiaries to the list of entities. This means that Huawei’s path of outsourcing chips will be “blocked”. The official website of the US State Department stated that the US Department of Commerce expanded its foreign direct product rules, which would prevent Huawei from circumventing US laws by “alternative chip production” and “providing off-the-shelf (OTS) chips produced with tools obtained from the United States”.
Huawei will now focus on notebooks
Huawei’s upcoming flagship Mate 40 and Mate 40 Pro smartphones will be the company’s last mobile phone using HiSilicon’s custom Kirin chip. The American ban technically affects only Huawei’s smartphone business. If the Chinese manufacturer will close any of its business because of the ban, it will be just its smartphone business. As if now, the company is already massively expanding its notebook line. It already has the digital series, X series, D series, and most recently the B series.