US Official Estimates Huawei’s AI Chip Production Could Reach 200,000 Units by 2025

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Understanding US Export Controls on AI Chip Production

During a recent hearing held by the House Foreign Affairs Subcommittee on South and Central Asia, Under Secretary of Commerce for Industry and Security, Jeffrey Kessler, shed light on the current state of China’s AI chip production capabilities. Specifically, he indicated that China’s production of Huawei’s Ascend chips is expected to be limited to a maximum of 200, 000 units.

Concerns Over China’s AI Chip Production Growth

At the outset of the hearing, Representative Bill Huizenga (R-MI) sought clarification from Kessler regarding Commerce Secretary Howard Lutnick’s assertions about China’s chip production. Kessler confirmed that the US government’s assessment maintains that “Huawei’s Ascend chip production capacity for 2025 will be at or below 200, 000, ”with the majority of these chips anticipated to remain within China’s borders.

While this figure may seem insignificant when compared to competitive outputs—NVIDIA, for example, is projected to ship over two million AI chips to its leading clients in 2024—Kessler cautioned against complacency. He emphasized that China is heavily investing in enhancing both the volume and sophistication of its AI chip production capabilities, intensifying the urgency for the US to remain vigilant regarding this emerging competition.

US Multilateral Agreements and AI Chip Security

The conversation turned to the implications of the recent US-UAE chip agreements established under the Trump administration’s Stargate initiative. Representative Sydney Kai Kamlager-Dove (D-CA) raised concerns about the security measures in place to prevent diversion of US technology to Chinese companies. Kessler reassured that the partner nations are aware of stringent security protocols governing AI chip exports, stating that any transactions must receive approval from the Bureau of Industry and Security (BIS).The BIS evaluates whether these technologies can be securely deployed overseas, a critical consideration before any approvals are granted.

Navigating International Competition in AI Chip Development

In addressing the gap China is reportedly closing in comparison to the US in chip production, Representative Ami Bera (D-CA) noted that the earlier-reported 200, 000 chip production limit was surprisingly low. Kessler outlined that the US approach to curtailing China’s chip advancements is twofold. The first strategy involves fostering international agreements, particularly with Middle Eastern countries, to ensure the continued global use of American AI chips, which he believes will bolster U. S.technological leadership.

The second prong of this strategy consists of stringent export controls aimed at ensuring that American technology does not aid the technological growth of adversarial firms such as Huawei.

Challenges in Multinational Alignment on Export Controls

Kessler was also queried about how allies’ export regulations could potentially undermine US efforts to restrict Chinese access to advanced AI chips. Although he acknowledged the complexities of the situation and admitted that much work remains, he noted progress in achieving alignment with some partner countries, albeit not without significant gaps. He pointed out that areas lacking alignment are unfortunately enabling adversaries to further their technological advancements.

Moreover, Kessler emphasized that the export control regime established by the US and its allies has unintentionally facilitated adversaries in seeking alternative routes for acquiring advanced technologies. These groups have demonstrated skill in circumventing restrictions, a concern that Kessler stated he has been personally focused on.

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