NAfter the basic agreement on further export restrictions for chip machines, the market leader ASML has to adjust to long-term losses. As the FAZ learned from the context of the negotiations, there are plans to exclude certain advanced types of the so-called DUV machines from being exported to China in the future. So far, ASML is only not allowed to deliver its most modern machines, the EUV devices, there.
The United States, the Netherlands and Japan, the location of other important chip machine manufacturers, had agreed in principle on Friday on export restrictions to China, as Bloomberg reported. “It is our understanding that steps have been taken toward an agreement between governments that will focus on advanced chip manufacturing technology,” ASML said when asked. They would now have to be defined in detail and poured into law, “which will take time”. CEO Peter Wennink spoke on Wednesday at the presentation of annual figures of possibly months.
ASML is initially optimistic
ASML is the leading manufacturer of chip machines for Intel, TSMC and others. Business with China accounts for around one seventh of chip machine sales. The US wants to cut off China from Western high technology, among other things for military reasons. The matter also affects German companies Trumpf and Zeiss, for which ASML is a key customer. Under American pressure, The Hague has already prevented ASML from exporting its EUV machines – the abbreviation for extreme ultraviolet light – to China. ASML has a global technical monopoly on these devices, which cost a good 160 million euros. The DUV machines – priced at 5 to 80 million euros each – vary in technical sophistication.
ASML
—
— (–)
For detailed view
Since the details of the agreements are still pending and the delivery times for the lithography machines are long, little has changed in the annual forecast that ASML made last week. “We do not expect these actions to have a material impact on our expectations that we have published for 2023,” the company said on request. For the time after that, things are poking around in the fog – especially since contracts with China have to be negotiated with reservations in the meantime. “It’s very much a question of whether what [bei den Verhandlungen] comes out, then becomes very visible, ”said Prime Minister Mark Rutte on Friday.
Wennink warned last week to use a sense of proportion. Among other things, he warned against impairing the extremely complex “ecosystem” of the chip industry with its tight supply chains too much. Chips would become more expensive, the lack of chips would intensify. What’s more, an isolated China could find itself forced to develop its own high-tech machines more quickly.
How is Japan reacting?
The first reaction from Japan with its manufacturers of lithography machines was meager in detail. “Japan strictly implements export controls based on international cooperation,” Economy Minister Yasutoshi Nishimura told reporters. The government is taking other countries’ export controls into account and responding appropriately, Nishimura said. He declined to comment on the specific talks with the United States.
However, his statements could also be interpreted to mean that not all details of the export controls have been clarified – and also that Japan will not adopt the American regulations one-to-one. Political circles in Tokyo also fear that China will react to Japanese export controls with countermeasures. Tokyo Electron , the leading Japanese maker of semiconductor production machines, did not comment, nor did Nikon .
China is currently working on another subsidy package for the semiconductor industry. Against the background of the American sanctions policy, Beijing wants to help her with a further 1 trillion yuan ($135 billion) in state aid over the next five years. This should not only push the construction of new semiconductor plants, but also advance research and development. Above all, however, the equipment industry is in the focus of Chinese industrial policy.
China’s semiconductor industry is growing strongly
In view of the upcoming blockades of European, American and Japanese machines for the production of chips, domestic companies such as Naura Technology, Advanced Micro-Fabrication Equipment Inc China or Kingsemi are decisive for them. For this reason, the funding programs that have been in place for years will be significantly increased once again. It is planned to grant 20 percent of the companies’ respective capital expenditures as direct subsidies. In addition, there should be tax incentives to encourage research and immediately put profits back into newly developed systems.
The island nation of Taiwan and South Korea are similar in their approach to building their national champions. Since the 1990s, the development of China’s chip industry has depended on close cooperation with technology leaders from Europe, America, Japan, Korea and Taiwan. On the other hand, the state is investing massively in the industry. Five years ago, Beijing declared that it wanted to stand on its own two feet in the semiconductor industry.
According to the Semiconductor Industry Association (SIA), two years ago, China’s semiconductor industry caught up with Europe’s with industry-wide sales of around $40 billion and a market share of almost 10 percent. As of 2015, revenues were $13 billion. With current growth averaging 30 percent a year, the around 15,000 Chinese companies registered as semiconductor companies could achieve a 17 percent share of the world market next year and dominate areas such as so-called industrial chips with structure sizes of 28 nanometers. But the Americans want to prevent that.