TSMC has reportedly suspended production of AI chips with 7nm technology and smaller ordered by the China-based company. Action was taken after a chip produced for a Chinese company was found on Huawei Ascend's AI chip which has been restricted from accessing the TSMC foundry for the past four years.
The notice was given by TSMC to customers in China last Monday. Production will still be done but subject to an approval process that may involve the United States first. The sale of the latest AI chips produced by AMD and NVIDIA has been imposed by the US on China for the past two years. China is trying to develop its own AI chips but their efforts are facing various obstacles due to technological barriers.
Among the efforts made by China is making high investments to drive the local semiconductor industry. There are reports that Huawei is willing to pay triple the salary to TSMC employees who move to their company.