Huawei is reportedly working on developing its own chip plant in Shanghai, China. Sanctions by the Trump administration prohibit any company from using US software or equipment to sell chips to Huawei without a license from the US Department of Commerce.

According to the Financial Times, the Huawei chip plant would not use American technology. Instead, it will allow Huawei to secure supplies for its core telecom infrastructure business.

According to the report, Huawei would not run the plant by itself. The Shanghai IC R&D Center, a chip research company with government support and also one of Huawei’s partners, will run it. The Financial Times reports that the plant will initially begin making 45nm chips. 45nm chips are a low-end chip that was in use over a decade ago.

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The Times also quotes sources as saying that Huawei plans to begin manufacturing more advanced 28nm chips before the end of 2021. The 28nm chips are useful in smart TVs and other IoT devices. The goal is to, however, produce 20nm chips, which it can use in its 5G telecoms equipment, by late 2022.

However, a semiconductor industry representative said that the plant will do little to help the company’s mobile business which is most hit by US sanctions. This is because “chipsets needed for smartphones need to be produced at more advanced technology nodes,” the representative said.

Huawei had mentioned lacking chips, revealing that it would be unable to make its own Kirin chips after 15th September 2020 because they are made by contractors using American technology.

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