Semiconductor chips are the core of scientific and technological development in today's world, and they are also the focus of fierce competition between China and the United States.
In order to curb China's chip industry, the United States does not hesitate to use various means, including suppression, pressure, and finding allies, in an attempt to cut off China's access to advanced chip manufacturing technology and equipment.
One of the most critical equipment is the lithography machine, which can be said to be the "heart" of chip manufacturing, which determines the performance and process level of the chip.
At present, only ASML in the Netherlands can produce state-of-the-art extreme ultraviolet (EUV) lithography machines, and China is one of ASML's most important markets.
However, under strong pressure from the United States, the Dutch authorities issued an export control measure in July this year, restricting the export of high-end lithography machines to China, which has been officially effective since September 1.
This is undoubtedly a heavy blow to China's chip industry.
However, ASML did not give up its business in China, but continued to choose the Chinese side, hoping to obtain exemptions from the relevant Dutch authorities to ensure that it can continue to supply lithography equipment to Chinese customers.
Why is ASML sticking to its business in China?
ASML is the world's largest supplier of semiconductor equipment and the only company capable of producing EUV lithography machines. EUV lithography machine is the most advanced chip manufacturing technology, which can realize the process node below 7 nm, greatly improving the performance and efficiency of the chip.
ASML has an absolute monopoly position in the global market, and its customers include Intel, Samsung, TSMC and other world-class chip manufacturers.
China is one of ASML's most important markets and one of its fastest-growing markets. According to ASML's financial report, the company shipped a total of 345 lithography machines last year, of which 14% were sold to mainland China.
ASML is unwilling to give up such a vast market or lose its customers and partners in China. ASML CEO Winningk made it clear that China's demand for mature process chips and "non-cutting-edge" chip manufacturing equipment is strong.
Therefore, under pressure from the United States, ASML did not fully comply with the export control measures of the Dutch authorities, but repeatedly stressed that this move only applies to "state-of-the-art" lithography systems, and the restrictions will not take effect immediately.
Nevertheless, due to the lack of free shipments, ASML's revenue in China will inevitably be disrupted.
Why did the Dutch authorities give Asmet approval?
Dutch authorities have secretly reached "secret agreements" with the United States and Japan to include advanced chip manufacturing technology in export control regulations.
As early as March this year, the Dutch Minister of Foreign Trade and Development Cooperation Schreinamaher made it clear that for the sake of "continental security", it is necessary to implement export controls on specific semiconductor manufacturing equipment.
In addition, the relevant Dutch authorities are also aware that China is an indispensable trading partner and market and cannot be easily offended.
Last year, the mainland was the third largest source of imports and the fifth largest destination of exports to the Netherlands, according to Statistics Netherlands.
The Netherlands and China have extensive cooperation in various fields such as agriculture, energy, environmental protection and finance. If the Dutch authorities fully cater to the will of the United States, it may trigger countermeasures from the Chinese side and have a serious impact on the Dutch economy.
Therefore, when implementing export control measures, the relevant Dutch authorities did not prohibit all types of lithography machines from exporting to China, but treated them differently according to different products and customers.
According to ASML, only EUV lithography machines currently need to obtain a new export license, while other types of immersion or dry lithography machines can be exported according to the original rules.
This has secured some special space for ASML. It is reported that ASML has applied for an export license for 8 EUV lithography machines from the relevant Dutch authorities, 4 of which are to meet the orders of Chinese customers.
While the applications have not yet been finalized, ASML expressed confidence that deliveries could be completed within the year.
How does ASML "choose sides" between China and the United States?
As the world's only EUV lithography machine manufacturer, ASML is on the cusp of semiconductor competition between China and the United States.
ASML had to strike a balance between China and the United States, both to avoid angering the United States and to preserve its business in China.
ASML's strategy is to try to comply with the export control regulations of the Dutch authorities, but also to strive for a share of the Chinese market.
Asml's CEO Winningk has said that ASML is a relatively "neutral" company and will not participate in any country's international considerations or geopolitical conflicts.
He also said that ASML will not give up the Chinese market because of US pressure, nor will it violate the regulations of the relevant Dutch authorities because of the temptation of China.
ASML's approach is to prioritize the needs of the United States and other allies when it comes to EUV lithography machines, while taking a cautious and conservative approach to China.
According to media reports, ASML plans to deliver 35 EUV lithography machines this year, most of which will be sold to regions such as the United States, Europe and Japan.
In other types of lithography machines, ASML is more flexible and active in providing services to the Chinese side. According to ASML's earnings report, the company's revenue in China in the first half of this year reached 1.4 billion euros, an increase of 25% year-on-year, accounting for 19% of total revenue.
epilogue
In short, although the Dutch ban officially came into effect, it did not completely cut off the possibility of ASML exporting high-end lithography machines to China. ASML seeks a balance between China and the United States, complying with the regulations of the Dutch authorities while also striving for a share of the Chinese market. This is both a challenge and an opportunity for China's chip industry.
On the one hand, China needs to accelerate the pace of independent research and development and breakthroughs in core technologies, and reduce its dependence on external supply chains;
On the other hand, China can also use some of the high-end equipment provided by ASML to improve its own chip manufacturing capabilities and levels.