There are rumors in the market that U.S. chip controls have led to an excessive shortage of advanced semiconductors, forcing the Chinese government to intervene in the production capacity allocation of Semiconductor Manufacturing International Corporation (SMIC).
The Wall Street Journal reported on the 11th, citing unnamed sources, that the Beijing authorities were trying to prioritize supplying SMIC production capacity to technology group and national team Huawei Technologies. Among them, Huawei mainly uses SMIC technology to build AI chips. Chinese technology companies are competing for limited domestic production capacity, and in some cases, laboratories are even smuggling high-performance chips from NVIDIA.
Sources revealed that DeepSeek, a well-known AI startup, was forced to postpone the release of its latest AI model earlier in 2025 due to chip shortages. Huawei and other companies have begun to find other ways, such as bundling thousands of chips into a huge and power-hungry system to help train AI models.
In order to resolve the impact of US export controls, Chinese companies and the Beijing authorities have taken extreme measures to highlight the importance of AI hegemony.
NVIDIA CEO Jensen Huang said through the official account of social platform
A statement from NVIDIA CEO Jensen Huang. pic.twitter.com/Exwx54OYJV
— NVIDIA Newsroom (@nvidianewsroom) November 5, 2025
Just as China is trying to achieve self-sufficiency in the semiconductor field, the Wall Street Journal quoted sources as saying that the authorities have instructed state-run data centers to stop using NVIDIA chips, and some have even decided to remove installed NVIDIA products from services. Authorities also asked companies not to use an older NVIDIA product, which some analysts viewed as a negotiating tool to win better-performing chips from the United States.
However, there are recent rumors in the market that the White House has notified major federal agencies that NVIDIA is not allowed to export the downgraded version of the latest AI chip "B30A" to China.
Further reading: US media: The White House informed the ministry that NVIDIA will not be allowed to sell B30A, a downgraded chip. Huang Renxun warns: The United States controls industries and may lose the AI competition to China US media: Jen-Hsun Huang hopes Trump will relax restrictions on chip losses, but Rubio and other officials oppose it