US officials doubt SMIC's competitiveness in 7nm chips

The U.S. Department of Commerce has expressed skepticism regarding Semiconductor Manufacturing International Corp. (SMIC) and its ability to compete on par with leading foundries like TSMC. While acknowledging SMIC’s progress in the 7nm class process technology, the department doubts the foundry’s capability to produce sufficient chips to meet Huawei’s demands. This, according to the department, signifies that the imposed curbs on China’s semiconductor sector are achieving their intended objectives.

Assistant Secretary for Export Administration, Thea Kendler, testified before a House Foreign Affairs Committee oversight panel, highlighting concerns about the performance and yields of SMIC-produced chips. Kendler stated that the semiconductor chip inside Huawei‘s Kirin 9000S, fabricated by SMIC using its 2nd generation 7nm-class process, exhibits lower performance than its predecessor and faces challenges in meeting market demands.

Concerns have been raised over SMIC’s capacity to meet Huawei’s chip demands with 7nm chips

The Huawei HiSilicon Kirin 9000S, despite being a notable breakthrough for SMIC and Huawei, faces difficulties in competing with rivals using advanced fabrication technologies. The chip’s performance, reportedly inferior to previous iterations and competitors like Apple’s A17 Pro and Qualcomm’s Snapdragon 8 Gen 3, raises questions about SMIC’s readiness to compete on a global scale.

Moreover, Kendler emphasized SMIC’s struggle to produce a sufficient quantity of Huawei’s Kirin 9000S due to limitations in access to modern tools. Despite Huawei’s plan to ship around 100 million smartphones in 2023, concerns linger about SMIC’s capacity to meet such demands without modern equipment.

While the U.S. government has imposed export controls to restrict China’s access to high-end process technologies, SMIC is reportedly making progress on a 5nm-class technology in addition to the 7nm one. The recent unveiling of the Huawei Mate 60 and Huawei Mate 60 Pro based on a domestically-made 7nm SoC adds complexity to the situation. The U.S. officials assert that the trade sanctions are effective, hindering China’s advanced technology acquisition, and expect continued obstacles for Huawei and SMIC in achieving complete autonomy in developing next-generation nodes. Despite reported subsidies from the Chinese government, SMIC’s journey toward autonomy faces challenges, reflecting the ongoing geopolitical dynamics in the semiconductor industry.