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I agree with the rest, that it is all manageable, but at least: > The whole chips fab thing may be a bridge too far for now for this case, ASML, being Dutch,

I agree with the rest, that it is all manageable, but at least: > The whole chips fab thing may be a bridge too far for now for this case, ASML, being Dutch, and crucial to essentially all cutting semiconductor production, gives Europe leverage. That said, a bit like Biden & Trump banning the export of certain tech to China, it is a slippery slope. Past a certain point they're just forced to develop the tech themselves. Hopefully Europe won't be as short-sighted or wilfully-ignorant, and will capitalise on their advantage here- as you are very correct to point out the ultimate vulnerability.

ExoticPearTree 1y ago
You forget one thing: ASML licenses american technology. They can't do anything out of the ordinary unless it has US' blessing. Hence, no leverage. Also, the machines are just one part of the equation. You need chip designs, you need actual foundries where these machines need to be installed and so on.
- saubeidl 1y ago
  If it really came to a falling out like this, why do you think US license rights would be considered at all?
  - klooney 1y ago
    ASML has a significant US research presence too. It's not just a bunch of dudes in Amsterdam.
    - pas 1y ago
      Eindhoven, it grew out of Phillips (and ASMI, also Dutch), but yes. The technology is funded by all stakeholders. Of course who got the IP and what kind of license is a different question. https://www.asml.com/en/company/about-asml/history https://www.asml.com/en/company/about-asml/history
FirmwareBurner 1y ago
>ASML, being Dutch, and crucial to essentially all cutting semiconductor production, gives Europe leverage It doesn't. Firstly, ASML's core EUV light source tech is licensed from the US who threatened to pull the plug if ASML sold EUV steppers to China. That's what actual leverage looks like. Secondly, you also need cutting edge semi fabs, which EU lacks. If it were that easy ASML would open some fabs in its own back yard with its cutting edge machines and keep the highest profits for themselves instead of letting TSMC, Samsung and Intel have them, but it's not easy. EU semi fabs are behind Taiwan, the US, China and Japan in node sizes despite having ASML domestically which is a huge blow for domestic industry and leverage. That's like making the best hammers but having no idea how to use them effectively. Thirdly, once you have the lithography machines and the fabs, you also need top IP to make cutting edge high margin chips with them, which the EU lacks. The highest grossing chips are all US IP: Nvidia, Apple, Qualcomm, AMD, Intel, Amazon, Ampere, while European chip companies are way down below the pecking order in profitability: Infineon, NXP, ST, making low margin chips the likes of Nvidia and AMD can't be bothered. Fourthly(is that correct in English?), once you have your litho, fabs and high end chips, you can now put all those powerful chips into datacenters to create powerful cloud hyperscalers, which the EU lacks. EU has nothing close to AWS, GPC, Azure, Tencent, Alibaba. This is what tech dominance looks like. And EU is third place behind the US and China.
- saubeidl 1y ago
  > Firstly, ASML's core EUV light source tech is licensed from the US who threatened to pull the plug if ASML sold EUV steppers to China. That's what actual leverage looks like. That's not any leverage at all. The EU would instantly write a law invalidating those licenses on their territory. Paperwork like that is meaningless in geopolitical conflicts.
  - FirmwareBurner 1y ago
    The asml EUV light source are made in California not Europe. Europe's laws and leverage would be useless in this case. They don't even have to burry ASML, they can sanction it, or better, just convince ASML to move all cutting edge operations on US soil like the US is doing with TSMC.
Havoc 1y ago
ASML is a power house that stomps all for sure. ...but they're an outlier in a specific part of the chain, not an ecosystem.

ExoticPearTree 1y ago

You forget one thing: ASML licenses american technology. They can't do anything out of the ordinary unless it has US' blessing. Hence, no leverage. Also, the machines are just one part of the equation. You need chip designs, you need actual foundries where these machines need to be installed and so on.

saubeidl 1y ago
If it really came to a falling out like this, why do you think US license rights would be considered at all?
- klooney 1y ago
  ASML has a significant US research presence too. It's not just a bunch of dudes in Amsterdam.
  - pas 1y ago
    Eindhoven, it grew out of Phillips (and ASMI, also Dutch), but yes. The technology is funded by all stakeholders. Of course who got the IP and what kind of license is a different question. https://www.asml.com/en/company/about-asml/history https://www.asml.com/en/company/about-asml/history

FirmwareBurner 1y ago

>ASML, being Dutch, and crucial to essentially all cutting semiconductor production, gives Europe leverage It doesn't. Firstly, ASML's core EUV light source tech is licensed from the US who threatened to pull the plug if ASML sold EUV steppers to China. That's what actual leverage looks like. Secondly, you also need cutting edge semi fabs, which EU lacks. If it were that easy ASML would open some fabs in its own back yard with its cutting edge machines and keep the highest profits for themselves instead of letting TSMC, Samsung and Intel have them, but it's not easy. EU semi fabs are behind Taiwan, the US, China and Japan in node sizes despite having ASML domestically which is a huge blow for domestic industry and leverage. That's like making the best hammers but having no idea how to use them effectively. Thirdly, once you have the lithography machines and the fabs, you also need top IP to make cutting edge high margin chips with them, which the EU lacks. The highest grossing chips are all US IP: Nvidia, Apple, Qualcomm, AMD, Intel, Amazon, Ampere, while European chip companies are way down below the pecking order in profitability: Infineon, NXP, ST, making low margin chips the likes of Nvidia and AMD can't be bothered. Fourthly(is that correct in English?), once you have your litho, fabs and high end chips, you can now put all those powerful chips into datacenters to create powerful cloud hyperscalers, which the EU lacks. EU has nothing close to AWS, GPC, Azure, Tencent, Alibaba. This is what tech dominance looks like. And EU is third place behind the US and China.

saubeidl 1y ago
> Firstly, ASML's core EUV light source tech is licensed from the US who threatened to pull the plug if ASML sold EUV steppers to China. That's what actual leverage looks like. That's not any leverage at all. The EU would instantly write a law invalidating those licenses on their territory. Paperwork like that is meaningless in geopolitical conflicts.
- FirmwareBurner 1y ago
  The asml EUV light source are made in California not Europe. Europe's laws and leverage would be useless in this case. They don't even have to burry ASML, they can sanction it, or better, just convince ASML to move all cutting edge operations on US soil like the US is doing with TSMC.

Havoc 1y ago

ASML is a power house that stomps all for sure. ...but they're an outlier in a specific part of the chain, not an ecosystem.