China to Triple AI Chip Production: Huawei and SMIC Strengthen Their Positions

Against the backdrop of tightening restrictions from the US and reduced access to foreign computing power, China is betting on the development of its own artificial intelligence solutions.

According to Financial Times sources, the country intends to triple its production of xPU series AI accelerators in the coming years.

The Role of Huawei and SMIC

A key element of the strategy will be the launch of a specialized production line that will work exclusively on the production of Huawei Ascend accelerators. Its launch is scheduled for the end of 2025. Two more plants are expected to come online next year. SMIC is actively involved in the process, supporting Huawei's efforts while simultaneously developing its own independent capabilities.

Vertical Integration

Huawei strives for complete control over the production cycle, from raw materials and chemicals to chip design and manufacturing. To this end, the corporation uses a network of subsidiaries and partner companies that it finances itself.

This model minimizes dependence on external suppliers and strengthens China's position in a strategically important industry.

New Generations of Accelerators

The focus will be on the Huawei Ascend 910D and Cambricon 690 chips, which use DeepSeek's proprietary UE8M0 FP8 format. This standard provides higher floating-point throughput and significantly improves the efficiency of training large language models and inference algorithms.

Global Implications

Plans to expand production underscore China's desire for technological independence. Mass production of domestic AI accelerators could shift the balance of power in the global semiconductor market and create new challenges for industry leaders in the US, Europe, and Taiwan.