China’s second-largest semiconductor manufacturer, Hua Hong Group, is preparing to produce advanced 7-nanometer (nm) chips, marking a significant step in the country’s efforts to strengthen its domestic semiconductor capabilities. The development is expected to make Hua Hong the second Chinese chipmaker, after Semiconductor Manufacturing International Corp. (SMIC), capable of manufacturing chips at the 7nm level.
The group’s contract chipmaking subsidiary, Huali Microelectronics, is developing the new 7nm manufacturing process at its facility in Shanghai. According to people familiar with the matter, test production has already begun, with the company targeting an initial output of several thousand wafers per month by the end of the year before gradually scaling up capacity.
The new technology is expected to support the production of advanced chips used in artificial intelligence applications. Industry sources say the development may involve cooperation with major domestic technology companies and equipment suppliers as China accelerates efforts to reduce dependence on foreign semiconductor technologies.
China has been investing heavily in its semiconductor industry in recent years as part of a broader national strategy to achieve technological self-reliance. Restrictions on access to advanced chipmaking equipment and technologies from Western countries have intensified Beijing’s push to strengthen domestic manufacturing capabilities and build a more independent supply chain.
Hua Hong has historically focused on producing mature-node chips used in consumer electronics, automotive components, and industrial applications. The move toward 7nm manufacturing represents a major technological upgrade for the company and signals China’s growing progress in producing more advanced semiconductors domestically.
The initiative highlights the increasing importance of semiconductor self-sufficiency for China’s technology sector, particularly as advanced chips play a critical role in artificial intelligence, data centers, telecommunications infrastructure, and next-generation computing systems.
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