The End For Huawei? U.S. To Reportedly Cut It Off From Global Chip Suppliers

Just days after the U.S. Commerce Department tightened technology export regulations to restrict chip supplies to Huawei Technologies, its first consequences were clear. Nikkei sources say that TSMC, the world's largest chipmaker, has stopped accepting new chip orders from the Chinese giant.

A person familiar with the current situation said, "TSMC has stopped taking new orders from Huawei after the new rule change was announced to fully comply with the latest export control regulation. But those already in production and those orders which TSMC took before the new ban are not impacted and could continue to proceed if those chips could be shipped before mid-September."

Last Friday, the Commerce Department said non-US chipmakers but using U.S. chip equipment, intellectual property, or chip design software would need to apply for a license before shipping. chip factory to Huawei.

Another Nikkei source said: "It's a difficult decision for TSMC as Huawei is the company's No. 2 customer, but the chipmaker has to follow the U.S. rules."

Although Huawei's subsidiary, HiSilicon Technologies, is capable of designing semiconductor chips by itself, the manufacturing and processing of these chips are largely dependent on TSMC, especially the processors that are made in the latest 7nm process.

As a result, new restrictions on US export regulations will have a heavy impact on Huawei, as most chipmakers around the world are using US equipment or software.

All chip-making partners for the Chinese iant are affected by the new restriction, including TSMC, SMIC, China's largest chipmaker today, as well as Win Semiconductors, a radio frequency chip manufacturer. Besides TSMC, Win Semiconductors is also a very important partner for Huawei as its components are used to replace US suppliers such as Skyworks and Qorvo.

In the current situation, SMIC may be the company's last hope to make chips for itself because the largest Chinese chipmaker is very favored by the Chinese government. However, SMIC is currently only able to produce chips on the 14nm process and is still lagging behind in developing its 7nm process.

Do you believe that Huawei will be able to survive this ban from the US government? Will you buy any products from the company after that? Let's us know in the comment section.

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