ASML Holding N.V. is facing significant pressure from the US government primarily due to geopolitical concerns surrounding China’s semiconductor industry. Here are the key points:
Export Restrictions: The US has been pushing the Netherlands to restrict ASML from exporting its advanced chipmaking equipment to China. This includes both extreme ultraviolet (EUV) and deep ultraviolet (DUV) lithography machines12.
License Revocations: Recently, the Dutch government, influenced by US pressure, partially revoked licenses that allowed ASML to ship certain lithography machines to China12.
Service Limitations: The US has also been urging ASML to stop servicing some of its equipment already in use in China, further limiting China’s ability to advance its semiconductor technology3.
Financial Impact: While ASML has stated that these restrictions are not expected to have a material impact on their financial outlook for 2023, the ongoing pressure and potential for more severe trade restrictions have created uncertainty in the market14.
These actions are part of a broader strategy by the US to curb China’s advancements in semiconductor technology, which is seen as critical for both economic and national security reasons12.
ASML is a Dutch multinational corporation that specializes in the development and manufacturing of photolithography machines used to produce computer chips. They are the world’s largest supplier for the semiconductor industry and the sole supplier of extreme ultraviolet (EUV) lithography machines, which are essential for manufacturing the most advanced chips.
What is the connection of ASML to Taiwan?
ASML has a significant connection to Taiwan, primarily through its relationship with Taiwan Semiconductor Manufacturing Company (TSMC), one of its biggest customers. Here are some key points about their connection:
Major Customer: TSMC is a major customer of ASML, particularly for its advanced extreme ultraviolet (EUV) lithography machines. These machines are crucial for producing the latest generation of semiconductor chips1.
Local Presence: ASML has a strong presence in Taiwan, with multiple facilities and a significant workforce. They have established their Taiwanese head office in Hsinchu and expanded operations to other locations like Linkou, Taichung, and Tainan2.
Investment: ASML has made substantial investments in Taiwan, including plans to build a new plant in New Taipei City’s Linkou District. This investment is part of their strategy to expand production capacity and support the local semiconductor industry34.
Supply Chain Integration: ASML is also working on integrating its European supply chain with its operations in Taiwan, further strengthening its ties with the Taiwanese semiconductor ecosystem3.
Training and Support: ASML has established a technology training center in Taiwan to provide timely support and training to local customers, ensuring they can effectively use ASML’s advanced lithography equipment2.
These connections highlight the strategic importance of Taiwan in ASML’s global operations and the critical role ASML plays in supporting Taiwan’s semiconductor industry.
Does ASML sell their machines directly to China?
ASML does sell its machines directly to China, but with certain restrictions. Here are some key points:
Sales of Older Machines: ASML is allowed to sell its older deep ultraviolet (DUV) lithography machines to China. These machines are less advanced than the extreme ultraviolet (EUV) lithography machines12.
Export Restrictions: Due to pressure from the U.S. government, the Dutch government has imposed restrictions on the sale of ASML’s most advanced EUV lithography machines to China. These restrictions are aimed at limiting China’s ability to produce cutting-edge semiconductor chips13.
Licensing Requirements: ASML needs a license to provide spare parts and software updates for some of the equipment it has previously sold to Chinese customers4.
Significant Market: Despite these restrictions, China remains a significant market for ASML. In the first quarter of 2024, China accounted for 49% of ASML’s system sales1.
ASML’s relationship with China is complex, balancing significant business interests with geopolitical pressures and export control regulations.
Reference: asml.com
