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China has taken large strides in every advanced manufacturing process. Made in China used to indicate low quality but that's far far from the current situation.

China has taken large strides in every advanced manufacturing process. Made in China used to indicate low quality but that's far far from the current situation. I just don't see why they wouldn't eventually be able to dominate high end chip production, just like they've catched up in other areas where people said they won't be able to compete. The sanctions might delay this for a couple of years, but it seems rather futile to think it can be delayed more than that. In my opinion it's a bad look on the US part to try to deny a hard working people access to tools to develop technology and produce wealth.

karlgkk 2y ago
> I just don't see why they wouldn't eventually be able to dominate high end chip production. Tbh the comment you’re responding to lays it out pretty well. The next step is a MASSIVE step. Tbh for most consumer and military applications, it’s fine. For margin sensitive stuff, not so much.
- monocasa 2y ago
  Consumer stuff is some of the most margin sensitive out there.
  - karlgkk 2y ago
    Yes, that is the point. For non-consumer stuff, it doesn't matter as much.
re-thc 2y ago
> China has taken large strides in every advanced manufacturing process. No they haven't, as in foreign companies in China have and invested in that. Not China itself. This is the big difference. So who is building these advanced manufacturing processes for them? > I just don't see why they wouldn't eventually be able to dominate high end chip production They've never bothered to. There's been huge corruption, lots of mismanagement, etc. Imagine a worse Intel. > hard working people access to tools to develop technology and produce wealth. Who says they're hard working? At least not in this sector. China has had plenty of time and resources before the sanctions and they've wasted it. They spent a staggering amount of $$$ (huge government investments), poached infinite amounts of talent and floundered it all already. Who says this will change?
- lossolo 2y ago
  China leads in 57 out of 64 technologies, up from just 3 twenty years ago. [1] The US lost its research advantage: it was leading in 60 technologies 20 years ago, down to just 7 today.[1] 1. https://www.aspi.org.au/report/aspis-two-decade-critical-technology-tracker https://www.aspi.org.au/report/aspis-two-decade-critical-tec...
  - re-thc 2y ago
    > China leads in 57 out of 64 technologies If this is in reply to China being hard working, then sorry, no. They're definitely hard working in obtaining technology. Maybe not by means you're thinking of (see e.g. Nortel, HTC or Via). Also, compared to 20 years ago? They were less open about it. Plenty of US, Singapore, Taiwan, Hong Kong, etc based companies were all just fronts for actual Chinese companies. The "made in China" logo back then didn't have Western appeal. Nowadays people are much more accepting of it.
  - lakis 2y ago
    This seems to be a joke. China has 70% of the world global research share on advanced aircraft engines Seriously? Maybe in writing papers . But that does not translate to actual product. China has 50% of electronic warfare and 45% of radar? In what planet? Any test to see if a lot of what is going on in other countries is not published?
    - geysersam 2y ago
      It's probably not completely accurate. But dismissing it entirely seems foolish. The change is dramatic and in a very short time.
    - lossolo 2y ago
      I'm not sure it's a joke. A lot of data supports that, maybe not all of it is accurate but you see the trend. https://www.economist.com/science-and-technology/2024/06/12/china-has-become-a-scientific-superpower https://www.economist.com/science-and-technology/2024/06/12/...
monocasa 2y ago
If anything I think the sanctions encourage China to make domestic competitors for what they're cut off from. And it's not like they're new to this field, chinese nationals almost certainly were among those that contributed to EUV development in the first place. There just isn't enough space in the market for more players like ASML without some backing geopolitical reason forcing the creation of new players.
audunw 2y ago
You should check out this article: https://www.theregister.com/2024/07/08/us_china_chip_wars_ideological/ https://www.theregister.com/2024/07/08/us_china_chip_wars_id... There was some news a while back that they had mastered making ball point pen tips. But you gotta keep in mind that these efforts have to be sustained long term and have to be a self-reliant economy on their own. Anyone can compete short term if you fuel your efforts with mountains of debt. But China's debt level (shadow debt included) has reached a breaking point. How many chip company bankruptcies can they take before the efforts break down? China can use a lot of "tricks" with their economy, since they're so authoritarian. But they're not THAT special. Their economy is not magic. The local governments have an insane amount of debt now, and they're in a situation where they can't make as much money off land leases anymore, so they have to raise taxes to avoid becoming insolvent. Yet foreign companies are already moving factories out of the country, so how can they stay competitive while raising taxes? This was already a huge debt, it was just never on paper. Now that debt is coming due. Keep in mind that the local governments are often involved in financing China's domestic industries.. Think about how the outlook would be if SMIC was in any other country. How would a chip company ever survive producing near cutting edge chips without a strong international market and high margins? If a western country bought hundreds of insanely expensive chip manufacturing machines that ended up gathering dust in a warehouse, it would be considered insane. This isn't sustainable. China has a decent domestic market, but it's very hard to sustain good margins there. Margins they desperately need to sustain an industrial effort that is being run in a much less economically efficient way than the western chip industry.

karlgkk 2y ago

> I just don't see why they wouldn't eventually be able to dominate high end chip production. Tbh the comment you’re responding to lays it out pretty well. The next step is a MASSIVE step. Tbh for most consumer and military applications, it’s fine. For margin sensitive stuff, not so much.

monocasa 2y ago
Consumer stuff is some of the most margin sensitive out there.
- karlgkk 2y ago
  Yes, that is the point. For non-consumer stuff, it doesn't matter as much.

re-thc 2y ago

> China has taken large strides in every advanced manufacturing process. No they haven't, as in foreign companies in China have and invested in that. Not China itself. This is the big difference. So who is building these advanced manufacturing processes for them? > I just don't see why they wouldn't eventually be able to dominate high end chip production They've never bothered to. There's been huge corruption, lots of mismanagement, etc. Imagine a worse Intel. > hard working people access to tools to develop technology and produce wealth. Who says they're hard working? At least not in this sector. China has had plenty of time and resources before the sanctions and they've wasted it. They spent a staggering amount of $$$ (huge government investments), poached infinite amounts of talent and floundered it all already. Who says this will change?

lossolo 2y ago
China leads in 57 out of 64 technologies, up from just 3 twenty years ago. [1] The US lost its research advantage: it was leading in 60 technologies 20 years ago, down to just 7 today.[1] 1. https://www.aspi.org.au/report/aspis-two-decade-critical-technology-tracker https://www.aspi.org.au/report/aspis-two-decade-critical-tec...
- re-thc 2y ago
  > China leads in 57 out of 64 technologies If this is in reply to China being hard working, then sorry, no. They're definitely hard working in obtaining technology. Maybe not by means you're thinking of (see e.g. Nortel, HTC or Via). Also, compared to 20 years ago? They were less open about it. Plenty of US, Singapore, Taiwan, Hong Kong, etc based companies were all just fronts for actual Chinese companies. The "made in China" logo back then didn't have Western appeal. Nowadays people are much more accepting of it.
- lakis 2y ago
  This seems to be a joke. China has 70% of the world global research share on advanced aircraft engines Seriously? Maybe in writing papers . But that does not translate to actual product. China has 50% of electronic warfare and 45% of radar? In what planet? Any test to see if a lot of what is going on in other countries is not published?
  - geysersam 2y ago
    It's probably not completely accurate. But dismissing it entirely seems foolish. The change is dramatic and in a very short time.
  - lossolo 2y ago
    I'm not sure it's a joke. A lot of data supports that, maybe not all of it is accurate but you see the trend. https://www.economist.com/science-and-technology/2024/06/12/china-has-become-a-scientific-superpower https://www.economist.com/science-and-technology/2024/06/12/...

monocasa 2y ago

If anything I think the sanctions encourage China to make domestic competitors for what they're cut off from. And it's not like they're new to this field, chinese nationals almost certainly were among those that contributed to EUV development in the first place. There just isn't enough space in the market for more players like ASML without some backing geopolitical reason forcing the creation of new players.

audunw 2y ago

You should check out this article: https://www.theregister.com/2024/07/08/us_china_chip_wars_ideological/ https://www.theregister.com/2024/07/08/us_china_chip_wars_id... There was some news a while back that they had mastered making ball point pen tips. But you gotta keep in mind that these efforts have to be sustained long term and have to be a self-reliant economy on their own. Anyone can compete short term if you fuel your efforts with mountains of debt. But China's debt level (shadow debt included) has reached a breaking point. How many chip company bankruptcies can they take before the efforts break down? China can use a lot of "tricks" with their economy, since they're so authoritarian. But they're not THAT special. Their economy is not magic. The local governments have an insane amount of debt now, and they're in a situation where they can't make as much money off land leases anymore, so they have to raise taxes to avoid becoming insolvent. Yet foreign companies are already moving factories out of the country, so how can they stay competitive while raising taxes? This was already a huge debt, it was just never on paper. Now that debt is coming due. Keep in mind that the local governments are often involved in financing China's domestic industries.. Think about how the outlook would be if SMIC was in any other country. How would a chip company ever survive producing near cutting edge chips without a strong international market and high margins? If a western country bought hundreds of insanely expensive chip manufacturing machines that ended up gathering dust in a warehouse, it would be considered insane. This isn't sustainable. China has a decent domestic market, but it's very hard to sustain good margins there. Margins they desperately need to sustain an industrial effort that is being run in a much less economically efficient way than the western chip industry.