The US has made a decision that will deepen the chip crisis. It wants to ban ASML from selling to China. So what does this mean?
The US is waging a major campaign to prevent China from monopolizing technology production. According to the latest allegations, US politicians want to prevent ASML, Europe’s largest chip hardware manufacturer, from selling to its Chinese partners. As you might expect, this would reduce chip production and increase prices.
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US to ban China from buying hardware from ASML
The semiconductor chip crisis, which has been going on for years, is likely to flare up even more with a new political blockade by the US. The Senate, which has already blocked many US companies from buying parts from China or forming partnerships, now wants to block deals with the Dutch company ASML.
A recent report by Bloomberg showed that the world’s largest manufacturer of lithography tools (equipment used in chip printing) is in the crosshairs. The US had previously prevented ASML from selling its extreme ultraviolet (EUV) lithography equipment to Chinese firms. Now it plans to stop the sale of deep ultraviolet (DUV) lithography tools.
DUV equipment is used in many segments of technology, from computers and servers to mobile electronics, autonomous vehicles and robots. So ASML’s inability to sell to China suggests that a new semiconductor crisis is at the door.
US politicians, who plan to break ASML’s agreements with Chinese manufacturers, have already started negotiations with the Dutch government. Accordingly, agreements with manufacturers such as Hua Hong, Semiconductor Manufacturing International Co (SMIC) and YMTC could be canceled.
It is also unclear whether agreements with global chipmakers (TSMC, Samsung and SK Hynix) will continue. Chinese manufacturers are also rumored to be able to buy DUV equipment from Canon and Nikon, but the largest manufacturer is ASML.
A possible blocking decision by the authorities from the Netherlands and ASML could widen the chip crisis all over the world. Especially as companies such as Samsung and Intel increase their investments, the future of technology parts is uncertain.