U.S. President Joe Biden and members of Congress are increasingly concerned about China’s ambitions for computer chips and their underlying technology. The New York Times recently quoted U.S. experts as saying that China’s inability to acquire lithography machines, the most complex machine chip production tool from Dutch semiconductor equipment company Asmac (ASML), makes it a pipe dream to create a self-sufficient semiconductor industry.
The former President Trump administration successfully lobbied the Dutch government to ban the sale of this equipment to China in 2019, and there is no indication that the Biden administration will change.
Manufacturers use chip lithography to project chip circuit graphics onto wafers, and the smaller the transistors and other components that can be placed on a chip, the more powerful it is and the more data it can hold. The Asmac lithography machine took decades to develop and in 1997 used extremely ultraviolet light with a very small wavelength, using technology and parts from the U.S., Japan and Germany to create a smaller circuit than conventional lithography, which began high-volume manufacturing in 2017. The machine is about the size and shape of a bus and costs $150 million per machine. This complex machine is recognized as a necessary tool for producing state-of-the-art chips with geopolitical impact.
Will Hunt, a research analyst at Georgetown University’s Center for Security and Emerging Technologies (CSET), said that without this system, manufacturers would not be able to produce top chips. He estimates that China will take at least a decade to build similar machines.
The Boston Consulting Group and the Semiconductor Industry Association (SIA) study noted that creating a self-sufficient chip supply chain would require at least $1 trillion, and would drive up the price of chips and products that use them. Harvard Business School Chinese professor of management Shi Zhaowei (Willy Shih) said, to achieve this goal for anyone is completely impractical.
A senior vice president of the U.S. International Business Machines Corporation (IBM) said the Asmac lithography machine is the most complex machine ever built by man. Since Asmac launched its commercial EUV model in 2017, customers have bought about 100 units, with buyers including Samsung and TSMC.
Now with a market capitalization of more than $285 billion, Wall Street analyst C.J. Muse says Asmac is “the most important company you’ve never heard of.