Huawei exec concerned over China’s inability to obtain 3.5nm chips, bemoans lack of advanced chipmaking tools

Huawei office
(Image credit: Shutterstock)

A high-ranking Huawei executive has reportedly made a rare admission that China’s ambitious semiconductor efforts may have peaked. On June 9, during the Mobile Computility Network Conference in Suzhou, China, Huawei’s Cloud Services CEO Zhang Ping’an voiced concerns about China’s inability to source 3.5nm chips because of U.S. sanctions.

Zhang pointed out that TSMC, based in Taiwan and therefore not subject to the U.S. sanctions, continues to increase its supply of 3.5nm semiconductors. “However, under U.S. sanctions, China has no way to secure these products,” he said.

The comments were reportedly a surprise to many in the industry since China has consistently reported confidence in the strength of its semiconductor growth. In May, the Chinese government announced a 65.6 trillion won ($47.5 billion) third fund to reinforce investment in the country’s semiconductor industry.

Huawei recently succeeded in mass-producing 7nm chips without using extreme ultraviolet (EUV) technology. This surprised the global semiconductor market and led to speculation that the chipmaker could soon mass-produce 5nm chips as well.

The restrictions the U.S. placed on sending manufacturing equipment and technology to China have prevented Chinese semiconductor tech from further advancement, though. Zhang noted that producing 3.5nm chips would require EUV technology, which China does not yet possess.

The nation is trying to develop the required technology on its own, but this is generally considered highly challenging because engineers need to circumvent U.S. and Dutch patents to succeed.

Given the difficulties China is facing from U.S. sanctions, Zhang believes Huawei and other manufacturers should make more effective use of the technology that is available. He said, "The reality is that we can't introduce advanced manufacturing equipment due to U.S. sanctions, and we need to find ways to effectively utilize the 7nm semiconductors."

The counterpoint to this is that some manufacturers are finding clever ways to work around the restrictions. Chinese DRAM maker CXMT circumvented U.S. sanctions on sub-18nm DRAM equipment by preparing to mass-produce 18.5nm DRAM. Mention has also been made of a “gray market” that allows Chinese firms to acquire U.S. equipment parts through unofficial procurement channels.

If China remains unable to produce more advanced semiconductors, it will likely try to continue growing its share of the legacy semiconductor market. Research firm Trend Force predicts that its share will increase from 29% in 2023 to 33% by 2027.

Freelance News Writer
  • peachpuff
    Time to steal some more ip... amiright?!?
    Reply
  • aetherwing
    peachpuff said:
    Time to steal some more ip... amiright?!?
    do you really trust anything comes out of CCP's mouth? i bet they already have the tools to make 5nm/3nm chips
    Reply
  • thisisaname
    peachpuff said:
    Time to steal some more ip... amiright?!?
    You mean pay homage too, with their world class research they have no reason to outright steal IP... /s
    Reply
  • Li Ken-un
    the Chinese government announced a 65.6 trillion won ($47.5 billion) third fund
    Won is the South Korean unit of currency…

    While etymologically/underlyingly represented by 圓 (yuan), whence came Japanese yen as well, the different Romanized forms are distinct words in their own right in the context of most Latin alphabet-based languages.

    And before the nationalists come to roast my remark… Yeah. I know.
    The Koreans write 원 (won).
    The Japanese write 円 (yen).
    The Chinese write 圆 (yuan).Taiwan is now the only country that actually writes it as 圓 (yuan).
    Reply
  • RyderXx
    well, of course wont be able to make anymore, the only way they got to 7nm is because of multi-patterning, and that makes the yield of the chip less effective to only 50%. its time to start using that $47 billion for IP theft i see.
    Reply
  • Jimmy_CYJ
    peachpuff said:
    Time to steal some more ip... amiright?!?
    First, I never heard of 3.5nm node. Secondly, There were more thorough discussions (attached below) about the IP issue regarding how Chinese engineers applied the self-aligned multiple patterning (SAMP), both single-material and dual-material schemes, to continue scaling in Semiwiki already. Actually, Chinese researchers have made pioneer progress in this area in the past 15 years and have been granted some important SAMP processing (US) patents. Intel reportedly applied the dual-material SAQP process to make at least their N10 M1 layer, but they didn't pay anything to Peking University that owns the related patent.

    ###

    ( First single-material SAQP paper was published by AMAT in 2011 SPIE Adavanced Lithography, but they didn't apply for a patent. So it has been globally used in FEOL fin step for free. The dual-material SAQP patent to use etching selectivity to solve the EPE issue, however, to my knowledge was invented in 2015 and patented by Peking University in 2017 (US patent: 9679771 B1). I guess Intel used it to at least fabricate N10 M1 (see TechInsights report), but Intel did not pay for it, for which PKU was discussing a law solution! There are two SAQP patents that are hot recently. The SiCarrier SAQP variant (CN CN117080054 A) is quite normal and will not be discussed here; the other one is from HiSilicon (CN 117751427 A), which extended 2x SALELE to 4x SALELELE..., the problem is that it requires too many masks (7-8), and the yield may be close to 0! The critical issue is not density multiplication such as 4x, it is the very small cuts/blocks and vias (12-16nm) that need to be self-aligned, otherwise they will miscut/mis-connect the wrong metal lines. The real shock is HiSilicon has a 7x (SASP which can drive down metal pitch to 12nm) patent that incorporate self-aligned vias & cuts (WIPO patent application # CN2022/097621). Details of this patent was just disclosed in the paper titled "Mandrel/spacer engineering based patterning and metallization incorporating metal layer division and rigorously self-aligned vias & cuts (SAVC)” in 2024SPIE Advanced Lithography+Patterning.)
    Reply
  • Dgggg
    Who the hell is reporting on this? Can you even tell the difference between Won and Yuan(rmb)?
    Reply
  • Jeff Butts
    Li Ken-un said:
    Won is the South Korean unit of currency…
    Thanks for the clarification. I should have known that, of course. The figure came from a Korean news outlet, so I should have known it was in their currency.
    Reply