China’s Hua Hong Prepares 7 nm Chip Production Amid Push for Tech Independence

China’s semiconductor industry is stepping forward, as Hua Hong Group, its 2nd largest chipmaker, is working on developing advanced 7-nanometre (nm) chip production. This development will have a great impact on Beijing’s broader effort to enhance domestic technology capabilities and minimize its dependency on foreign suppliers.

Currently, China’s leading foundry, Semiconductor Manufacturing International Corp. (SMIC), is the only manufacturer that produces chips at the 7nm scale. Whereas the people working at Hua Hong have demonstrated that Huali Microelectronics has successfully developed a mechanism sufficient to produce chips using a 7 nm node at its fabrication facility. 

This idea was initiated by China due to the export restrictions from the United States, resulting in the limitation of access to advanced chip technology. Although a few restrictions from companies like Nvidia were dismissed, as they were allowed to sell a few artificial intelligence chips in the Chinese market. 

The research and development work on the 7nm process was successfully initiated last year at Hua Hong’s Fab 6 facility, which is the most advanced site at the group’s lab. Moreover, a few domestic equipment providers, such as Huawei, have assisted in this project. Testing a few of these pieces of equipment occurred in Shenzhen before their implementation at the Shanghai plant.

Hua Hong’s Fab 6 currently manufactures chips using 22nm and 28nm processes; by contrast, most other groups offer mature technologies ranging from 40nm to 55nm. Based on this, it can be demonstrated that 7nm production will indeed mark a significant impact on China’s domestic semiconductor capabilities.  

According to industry sources, Huali is focused on reaching an early output capacity of several thousand wafers per month by the year’s end, with the possibility of expanding production in the future if the process proves stable.

One potential customer for the new production line is Chinese graphics processor developer Biren Technology, which has been testing chip designs at the facility. The company previously relied on overseas manufacturing partners but lost access after being placed on a U.S. trade blacklist in 2023.