China Launches Local Production of HBM Chips, Leaders Divided

Chinese manufacturers of the CXMT and Wuhan Xinxin began production of their own high-speed memory of HBM, used in chipsets for artificial intelligence. This is an important step in China’s efforts to reduce dependence on foreign suppliers amidst tensions with the United States, which have resulted in restrictions on the export of American chips to China.

CXMT, the largest DRAM manufacturer in China, has collaborated with the packaging and testing company Tongfu Microelectronics to develop HBM chips samples that have already been showcased to customers. Following this news, Tongfu Microelectronics saw an 8% increase in their shares.

Simultaneously, Wuhan Xinxin is actively constructing a plant capable of producing three thousand 12-inch HBM wafers per month. The construction of the plant commenced in February of this year, and Chinese chip manufacturers have been engaging with South Korean and Japanese companies to procure equipment for HBM development.

China is making substantial investments in the development of their domestic microchip production, offering funding to local companies. By 2026, Huawei plans to manufacture HBM2 chips in collaboration with other Chinese firms. The group of companies led by Huawei, along with the memory manufacturer Fujian Jinhua Integrated Circuit, is also dedicated to advancing HBM technology.

HBM memory, introduced in 2013, is particularly suited for processing large volumes of data generated by complex AI applications. Currently, the HBM market is dominated by South Korean companies like SK Hynix and Samsung, as well as American giant Micron Technology, who produce HBM3 and are working on the HBM3E standard.

Chinese efforts are mainly concentrated on HBM2 production due to restricted access to HBM3 resulting from American sanctions. Nori Chiu, Investment Director at White Oak Capital, points out that Chinese manufacturers are lagging behind global HBM competitors by approximately a decade. Nevertheless, this setback isn’t discouraging them.

The collaboration between CXMT and Tongfu represents significant potential for China in the advancement of memory and packaging technologies. Since 2022, CXMT has filed around 130 patents related to HBM production and functionality, including patents for advanced packaging techniques like hybrid connection.

It is likely that Chinese manufacturers will eventually discover loopholes or make substantial advancements in their technologies, enabling them to catch up with the leading global microchip manufacturers and establish

/Reports, release notes, official announcements.