China has reportedly expanded its pursuit of developing AI technology on home soil, as the nation is expected to increase AI chip production by threefold in just a few years.
Huawei, Cambricon & Other Domestic AI Firms to Lead The Way For High-End Chinese AI Chips, Rivaling Western Counterparts
When you look at the recent geopolitical situation, it is clear that Beijing is pivoting away from Western AI hardware solutions, and while this move will take several years, China is preparing ahead of time. According to a new report by The Financial Times, it is claimed that the nation intends to increase its AI chip production by up to 3x within the next few years, and this move will benefit the likes of Huawei, DeepSeek, and Cambricon, which are the most capable domestic AI firms for now.
It is claimed that a dedicated fab for Huawei's AI chips is expected to come online by year-end, with two more facilities in the pipeline as well, which are slated for production by next year. The combined capacity from these plants is claimed to rival SMIC's production figures, which shows that domestic AI firms are indeed scaling up the Chinese semiconductor industry. More importantly, SMIC themselves are looking to double 7nm production by 2026, which shows that the demand for homegrown nodes is higher than ever with the AI frenzy.
China's AI chip solutions are much better positioned to rival NVIDIA than they were a few years ago, with options such as Huawei's Ascend 910D and Cambricon’s 690 leading the race. Interestingly, DeepSeek revealed a few days ago that they were switching up AI models to be tailored to the FP8 format, which no Chinese AI chip offers as of right now. However, there are signs that a solution has been developed, most likely by Cambricon, judging by its recent stock price soar.
Reducing reliance on foreign hardware has become a national priority, which is why a report from Ctee claims that the People’s Government of Beijing Municipality is seeking 100% self-reliance in AI compute. For now, China is way behind the likes of NVIDIA, but the region is seeing breakthroughs in multiple segments, such as chip processes, high-bandwidth memory, and packaging technologies. This indicates that a robust ecosystem is in the process of being developed that would help Chinese AI firms come up with capable solutions.
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