(Bloomberg) — ASML Holding NV and Taiwan Semiconductor Manufacturing Co. have ways to disable the world’s most sophisticated chipmaking machines in the event China invades Taiwan, according to people familiar with the matter.
Most read on Bloomberg
U.S. government officials have privately expressed concerns to their Dutch and Taiwanese counterparts about what would happen if Chinese aggression escalates into an attack on the island responsible for producing the vast majority of China’s advanced semiconductors. world, two of the people said, speaking conditionally. of anonymity.
ASML reassured officials of its ability to disable machines remotely when the Dutch government met with the company about the threat, two other people said. The Netherlands has carried out simulations of a possible invasion to better assess the risks, they added.
Spokespeople for ASML, TSMC and the Dutch Ministry of Commerce declined to comment. Spokespeople for the White House National Security Council, U.S. Department of Defense and U.S. Commerce Department did not respond to emailed requests for comment.
The remote shutdown applies to Netherlands-based ASML’s line of extreme ultraviolet machines, known in the industry as EUV, for which TSMC is its largest customer. EUVs harness high-frequency light waves to print the smallest existing microchip transistors, creating chips that have uses for artificial intelligence as well as more sensitive military applications.
The size of a city bus, an EUV requires regular maintenance and updates. Under this framework, the company can remotely force a shutdown that would act as a circuit breaker, the sources said, speaking on condition of anonymity. The Veldhoven-based company is the world’s only manufacturer of the machines, which each sell for more than 200 million euros ($217 million).
ASML’s technology has long been the subject of government intervention aimed at preventing it from falling into the wrong hands. The Netherlands, for example, prohibits the company from selling EUV machines to China, because the United States fears giving its rival an advantage in the global chip war.
It was at the request of the United States that the Dutch began suspending exports of ASML’s most sophisticated chipmaking machines this year. Even before the ban took effect, U.S. authorities had asked ASML to cancel some previously scheduled shipments to Chinese customers, Bloomberg News reported.
The company expects up to 15% of its sales to China this year to be affected by the latest export control measures.
The evidence suggests that the restrictions may have come too late to halt Chinese advances. Huawei Technologies Co. produced a smartphone last year to rival Apple Inc.’s iPhone using chips made with old ASML printers in combination with tools from two U.S. suppliers, Bloomberg News reported in October after the phone crashes.
Beijing has made technological self-sufficiency a national priority, and Huawei’s efforts to advance chip design and manufacturing domestically have received government support.
China has long claimed that the island of Taiwan is its territory, with President Xi Jinping both advocating unification and refusing to rule out military intervention. The superpower has been building its military and nuclear arsenal on a scale not seen since World War II and a senior US admiral said in March it was preparing to be able to invade Taiwan by 2027.
The US Congress last month approved $8 billion in aid to bolster the island’s defenses. The Biden administration is also seeking to boost semiconductor production on U.S. soil, promising $39 billion in subsidies to chipmakers to guard against any future supply chain disruptions.
The stakes are high, as nearly 90% of the world’s most advanced chips are made in Taiwan. On May 20, Taiwan named Lai Ching-te president of the global microchip hub, putting in power a man whom Beijing called a “war instigator.”
The EUV machine has helped make ASML Europe’s most valuable technology stock, with a market capitalization exceeding $370 billion, more than double that of its client Intel Corp.
ASML has shipped more than 200 of these machines to customers outside China since their initial development in 2016, with TSMC having acquired more than any other chipmaker.
EUVs require such frequent maintenance that without ASML’s replacement parts, they quickly stop working, the sources said. On-site maintenance of EUVs poses a challenge because they are housed in clean rooms that require engineers to wear special suits to avoid contamination.
ASML offers some customers joint service contracts in which they perform some of the routine maintenance themselves, allowing customers like TSMC to access the system of their own machines. ASML claims that it cannot access the proprietary data of its customers.
TSMC Chairman Mark Liu suggested in a September interview with CNN that any invader of Taiwan would find his company’s chipmaking machines out of commission.
“No one can control TSMC by force,” Liu said. “If there is a military invasion, you will render the TSMC factory unusable.”
—With help from Justin Sink, Mackenzie Hawkins, Nick Wadhams and Debby Wu.
Most read from Bloomberg Businessweek
©2024 Bloomberg LP
News Source : finance.yahoo.com
Gn bussni
