China Chipmakers Speed Up Effort to Cut Reliance on US Supplies

09/09/2020

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Cheng Ting-Fang and Lauly Li | Nikkei Asian Review

TAIPEI — China’s top chipmakers are speeding up efforts to reduce their use of U.S semiconductor equipment as fears mount that Washington will impose further curbs on their operations as part of a tech war, people with knowledge of the plans told the Nikkei Asian Review.

Semiconductor Manufacturing International Corporation, the country’s top contract chipmaker better known as SMIC, and Yangtze Memory Technologies, China’s first 3D NAND flash memory maker, are among the companies setting ambitious goals to test homegrown and non-U.S. equipment in their production lines. Several state-backed chipmakers are doing likewise, multiple people familiar with the plans told the Nikkei Asian Review.

Chinese chipmakers have also stockpiled several years worth of inventories of some supplies from the likes of Applied Materials, a big U.S. equipment maker, the sources said.

“It’s really geopolitical risks that are pushing Chinese chipmakers to forge a plan B as soon as possible,” a source told Nikkei.

SMIC has set an aggressive target to begin trial production for a 40-nanometer chip production line without American equipment before the end of this year, and aims to build more advanced 28-nm chips on the same basis in three years, people with knowledge of the plans told Nikkei.

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