Huawei ban to trigger a large chip inventory backlog – Post Daily

In early August, the US government again extended Huawei’s ban. The new ban bans suppliers from selling US-made brands to Huawei. At present, the US government is trying to support US semiconductor companies in moving their production centers from Asia. According to reports, the suppression of the US by Huawei under this pressure will cause problems in the chip industry. This will cause a large stock delay in the entire chip industry.

Huawei bans recovery

According to Dan Hutcheson, CEO of VLSI Research, China’s ban on Huawei has caused a large stockpile across the chip industry. In addition, he claims that Washington’s previous $ 22.8 billion funding proposal is insufficient. To fill this gap (encourage US manufacturers to build chip factories as part of the current Sino-US technology war).

Hutcherson said that if the aid fund rises to $ 50 billion, expectations can be met. However, it is technically impossible for the US government to agree on this amount.

The cost of building a chip factory is as high as $ 15 billion and most of the cost is spent on expensive tools. Therefore, the proposal would provide a 40% refundable income tax credit for semiconductor equipment. Aid funds include $ 10 billion in federal funds for government incentives to build factories. The other $ 12 billion will be research and development funds.

Industry insiders have made it clear that while there is a network of “trusted foundries” in the United States to help supply chips to the US government, many brands still need to be purchased from Asia.

Huawei’s ban is political

The impact between the US and Huawei has attracted so much attention. According to Ren Zhengfei, founder and CEO of Huawei, the US ban on Huawei is political. He said: “The desire for survival inspires us to find a way to be saved. No matter what, we will never hate the United States. It is simply the push of certain policies and does not represent American companies, American schools and American society … We still have to stick to the path of self-improvement and transparency. “If you want to be really strong, you have to learn from everyone, including your own enemies.”

Ren Zhengfei openly said that “some politicians in the US want us to die. We also want to light the ‘beacon’ of 5G, but as soon as the ‘race’ was over, the United States hit us with a ‘big stick’ and hit us unconsciously. “At first I thought there was something wrong with our compliance system.”

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