U.S. Sanctions Impacting China’s AI Chip Production: Huawei’s Struggle with Ascend 910B

The U.S. government’s sanctions against China’s advanced technology efforts are proving effective, particularly in the field of AI chip production. Huawei, a leading Chinese tech giant, is reportedly facing significant challenges in increasing the production of its Ascend 910B AI chip, a crucial component intended to rival Nvidia’s offerings, which are restricted under U.S. trade laws.

According to a recent report by The Information, Huawei’s difficulties stem from the limitations imposed by using older chip fabrication equipment. These machines, originally designed for previous generations of chips, are not well-suited for the demands of producing advanced AI chips like the Ascend 910B. The adaptation process has led to frequent breakdowns of critical components, complicating production efforts.

The U.S. has extended its reach by encouraging allies, including South Korea, to adopt similar export controls, aiming to stifle China’s technological and military advancements. Since 2019, Huawei has been on the U.S. Department of Commerce’s trade blacklist, though it has occasionally obtained advanced chipmaking tools under special licenses.

Despite these obstacles, Huawei and its main chip manufacturer, Semiconductor Manufacturing International Corp. (SMIC), had projected an annual production rate of approximately 500,000 Ascend chips. However, the reality of production has proven more complex, with ongoing issues in identifying and replacing faulty components.

This slowdown in production is not just a setback for Huawei but also impacts other major Chinese tech firms like Baidu and Alibaba, which rely on Huawei’s chips in lieu of accessible Nvidia products.

In August, Huawei attempted a breakthrough with the Mate 60 Pro smartphone, featuring a Kirin 9000s chip from SMIC using 7-nanometer technology, despite the sanctions. This development utilized technology from U.S. companies like Applied Materials Inc. and Lam Research Corp., underscoring the challenges Huawei faces in developing technology independent of U.S. expertise.

U.S. Secretary of Commerce Gina Raimondo has remarked that while Huawei’s innovations are noteworthy, they still lag significantly behind American technology. This ongoing technological tug-of-war highlights the broader geopolitical tensions between the U.S. and China, particularly in the critical arena of semiconductor technology.