Huawei establishing significantly large Research and Development facility for chip manufacturing in Shanghai
Huawei Expands Semiconductor Research in Shanghai
Huawei Technologies is making significant strides in its semiconductor news with the construction of a new research and development (R&D) center in Shanghai's Qingpu district. The sprawling campus, spanning approximately 224 football fields, is almost twice the size of the company's renowned Ox Horn Campus.
The new center, which is housed on this spacious campus, includes a major chip development center, the new headquarters of HiSilicon Technologies, research centers for wireless technologies and smartphones, and other facilities. According to the Shanghai government, the total investment for the R&D base is approximately RMB 12 billion (USD 1.66 billion).
In a recent analysis, Brady Wang, a semiconductor analyst with Counterpoint, predicted that Huawei will strive to localize a greater portion of its semiconductor news chain. However, realizing these efforts, particularly those related to chip manufacturing and equipment, will be a time-intensive undertaking.
Huawei has been actively recruiting talent to aid in this endeavour. The company has hired numerous engineers who have worked with top global chip tool builders like Applied Materials, Lam Research, KLA, and ASML. Chip industry veterans with more than 15 years of experience at leading chipmakers like TSMC, Intel, and Micron are also among recent and potential hires.
The mission of the center includes building lithography machines, vital equipment for producing cutting-edge chips. This move comes as semiconductor news has been caught in the crosshairs of US export controls. In response, many Chinese chipmakers, including Huawei, have responded to the US crackdown by seeking domestic alternatives wherever possible.
The R&D spending of Huawei in 2023 reached a record high of RMB 164.7 billion (USD 22.7 billion), representing 23.4% of its total revenue. The company has worked hard to localize its chip-related sources and switch to local components from suppliers such as BOE Technology and Omnivision.
Huawei is also venturing into chip production itself with partners backed by local governments in multiple Chinese cities. The company partners with several Chinese semiconductor manufacturers supported by local governments in cities such as Shenzhen, Qingdao, and Quanzhou, investing in chip production infrastructure to reduce reliance on foreign fabs.
Despite the challenges posed by US export controls, Huawei is offering salary packages worth up to twice as much as local chipmakers to staff the new center. When completed, the Shanghai campus will be able to accommodate more than 35,000 high-tech workers.
Washington has lobbied allies Japan and the Netherlands to implement similar restrictions on the export of advanced chip tools to limit China's access to them. However, the resilience and determination shown by Huawei in its semiconductor news efforts suggest that the company is determined to overcome these obstacles and secure its position in the global semiconductor industry.
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