Can China build its own ASML?

Beijing wants 100% domestic chip equipment, but lithography remains an uphill battle CHENG TING-FANG, LAULY LI, SHUNSUKE TABETA ASML's manufacturing clean room in Veldhoven, the Netherlands (Video courtesy of ASML) ASML's manufacturing clean room in Veldhoven, the Netherlands (Video courtesy of ASML) Beijing wants 100% domestic chip equipment, but lithography remains an uphill battle CHENG TING-FANG, LAULY LI, SHUNSUKE TABETA ASML's manufacturing clean room in Veldhoven, the Netherlands (Video courtesy of ASML) ASML's manufacturing clean room in Veldhoven, the Netherlands (Video courtesy of ASML) In southeastern Beijing, engineers at Semiconductor Manufacturing International Corp., China's top chipmaker, are working around the clock to expand the output of 14-nanometer and even 7-nm chips, just a few generations behind the world's leading chipmakers. Being able to make such advanced chips at all is a major breakthrough for a company that has been laboring under a U.S. blacklisting for five years.But SMIC's mission goes beyond just making the chips. It wants to produce them entirely with Chinese equipment.That goal -- a fully domestic chip equipment supply chain -- is laid out explicitly in the city’s 14th Five-Year Plan, an economic roadmap for the capital, and the nation’s chipmakers are pushing hard to make it a reality, even if it means sacrificing production quality and efficiency in the short term, sources tell Nikkei Asia.SMIC and its peers, including local leading memory makers CXMT and YMTC, have achieved striking progress on several fronts, replacing foreign tools used for etching, measurements, deposition, chemical polishing and more with domestic alternatives, according to multiple interviews with industry executives by Nikkei Asia. But one daunting hurdle remains: lithography. The process of projecting and printing chip developers' designs onto a wafer is vital to the ultimate performance of the chip. But lithography machines are so complex and expensive that only three companies in the world -- ASML of the Netherlands and Japan's Canon and Nikon -- are capable of producing them. Last year, lithography accounted for nearly 25% of global spending on chipmaking equipment, according to industry group SEMI. Top Chinese chipmaker SMIC is expanding plants in Beijing to make 7-nm and 14-nm chips, the most advanced in the nation. Top Chinese chipmaker SMIC is expanding plants in Beijing to make 7-nm and 14-nm chips, the most advanced in the nation. For China, this remains a painful gap in its push for tech self-sufficiency. "Local lithography tools are still a blank spot and [China is] nowhere close to being self-sufficient," said one supply chain executive who counts major Chinese chipmakers as clients. "Most production lines are still using ASML or Nikon machines, even if those are their older models." ASML is the largest global chip tool maker by market capitalization, as well as the leader in immersion deep ultraviolet (DUV) technology, used to make chips for everything from smartphones to cars to defense equipment. The Dutch company is also the exclusive maker of extreme ultraviolet (EUV) lithography tools, which chip titans like TSMC, Samsung and Intel use to make the world's most advanced processors and memory chips. At its headquarters in Veldhoven, engineers are already busy putting the final touches on an even more advanced machine, one that ASML hopes will support cutting-edge chip production through the early 2030s. The high-NA EUV machine, as it is called, is now being shipped to TSMC and Intel for field trials, and the company expects broader industry adoption to follow. At $350 million apiece, the machine is the most expensive chipmaking tool ever built. ASML's high-NA EUV lithography machine weighs 150,000 kg, stretches 14 meters long by 4 meters high and 4 meters wide, and is made up of millions of components. Industry sources call it the most complex machine ever built. Your browser does not support this video In the source vessel, EUV light is generated by a powerful laser striking 50,000 tiny droplets of tin per second. This light is used to print the chip features on the wafer. ——Key suppliers: Trumpf (laser), Cymer (EUV light source) Your browser does not support this video The reticle handler holds the mask, or reticle, that contains the pattern to be printed on the wafer. The reticle moves with extreme acceleration, and this speed is key to producing more chips per hour. ——Key supplier: ASML's team in Connecticut Your browser does not support this video In the wafer handler, precision robotic arms transfer wafers in and out of the system's vacuum environment, operating with high positioning accuracy and at a consistent temperature. Your browser does not support this video The wafer stage positions the wafer with a precision of less than a nanometer -- about 4 silicon atoms -- for each exposure, checking and adjusting 20,000 times per second. Your brow

Can China build its own ASML?

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