After shutting off some hardware and software components for many of the equipment it manufactures, the United States is now trying to impose a complete shutdown on the chips Huawei supplies. This new movement supposes a hard blow for both Chinese technology and TSMC, the leading global provider of semiconductors.
Extending the veto on the use of Google services after one year of its launch for at least another year, the government of Donald Trump is now going for the chips that give life to its smartphones, tablets and connected devices .
The US Commerce Department said Friday that it is tightening the rules “to specifically and strategically direct Huawei’s acquisition of semiconductors that are the direct product of certain US software and technology.” This is what several English-speaking media collect this Friday.
New measures, possible retaliation
The new measures may provoke a reciprocal response from the Chinese government with US companies. The state newspaper Global Times notes this Friday, in some retaliation that could affect companies like Apple, Cisco, Qualcomm or Boeing.
Upon arrival in port, these new restrictions from TSMC – who has just announced the construction of a new plant with the capacity to manufacture 5nm processors in the United States – would be a serious blow to the second largest smartphone manufacturer worldwide. global. In 2019, Huawei distributed 240 million of these devices.
TSMC affirmed this Friday that it is “working with external advisers to carry out a legal analysis and guarantee a thorough examination and interpretation of these norms.” He further notes that “the semiconductor industry supply chain is extremely complex, and is served by a broad collection of international suppliers,” according to Reuters.
Huawei’s processors in doubt
This week, Huawei announced its first manufactured SMIC processor, a Chinese foundry, manufactured in a 14-nanometer process. Thus diversifying its suppliers outside TSMC in a movement that it might be too late.
It is not the first time that Huawei has encountered difficulties in this regard. A year ago, the Chinese giant was paralyzed in its production and renewal of notebooks when it ran out of supply from Intel, Nvidia or AMD. This occurred despite the fact that they were accumulating components to function in the event of a shortage, and that this resumed a few months later.
Huawei is now in full launch of its P40 series. They recently launched their P40 and P40 Pro without Google services. Over the next few weeks, the most advanced P40 Pro + is expected to arrive in China. These phones have a Kirin 990 5G on board, manufactured in TSMC’s latest 7nm + process.
Both Huawei Mate 40 and P50 next year are expected with a HiSilicon 1000, manufactured in a shrunken and more efficient 5 nanometer scale. If this new limitation becomes effective, TSMC could not manufacture these next Huawei processors.
The US government would thus put one more weight on the balance of the trade war. Huawei’s annual turnover in 2019 was more than 110,000 million euros, or already about 1% of the Chinese economy. Having no chips in its two largest divisions – smart devices and network equipment – would undoubtedly be a great blow to the Asian giant.
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