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They are nowhere close to beat ASML. This isn't a moat ASML can keep for long though. There can be alternatove technologies to achieve the same goal. So far on
by bgnn 10mo ago
They are nowhere close to beat ASML.
This isn't a moat ASML can keep for long though. There can be alternatove technologies to achieve the same goal. So far only China has that incentive. The real problem is process scaling is slowing down. How many more generations of lithography machines will ASML design? Probably not many. This means there will be no edge left in 5 or 10 years, as eventually brute force will work and China will achieve the same lithography resolution.
Till that point, they are just going all in with cheap coal + solar, so even if they use older machines and run longer exposure times, even if they achieve lower yields and toss away a lot of the dies, they are still economically competitive. At the end cheap enery solves a lot of the issues.
- petre 10mo agoNo, they won't beat ASML but they'll be good enough and most importantly cheap. And they'll catch up eventually.
- bgnn 10mo agoThat's basically what I said, no?
- askvictor 10mo ago> So far only China has that incentive. The US is close to having that incentive, if the rift between the US and Europe keeps widening. The Netherlands has one lever, but damn it's a long one.
- renewiltord 10mo agoASML develops and ships their machines at the pleasure of Uncle Sam because the USA licensed them the tech and remains a crucial part of the supply chain intentionally. It's not a lever. It's a partnership that is mutually beneficial and neither side can really ruin the other without damaging themselves.
- saubeidl 10mo agoIf Uncle Sam pisses off Europa Regina enough, she won't give a damn about licenses.
- renewiltord 10mo agoASML will instantly stall at that point. The EUV light sources are built in the US under US export control regulation. No EUV light source means no ASML EUV machine. I get that some European chest-beating sounds good because there's not very much tech in Europe, but this is an intentional transnational supply chain. It's no accident that the US chose ASML to develop this tech rather than Canon or Nikon. Close ally deep within the US military shield from nearby air bases. The biggest losers from any such actual attempt by Europe will be Western Europe and the US. I really like that Europeans are starting to be more patriotic. It's good to see. It's also fortunate that European leaders are aware of Europe's position and role in geopolitics.
- saubeidl 10mo agoWell, it sounds like an alternative supplier for EUV light sources just became available...
- renewiltord 10mo agoAn alternative manufacturer, but not a supplier, no. The US exerts sufficient control over ASML that this will not happen without NATO ending. And the end of NATO (which would be a geopolitical shift more profound than the Fall of the Berlin Wall) and a replacement with some Chinese EUV light source risks the scuttling of all ASML facilities and devices. This is vapor above a coffee cup.
- saubeidl 10mo agoThe scenario I'm imagining is in fact the US further destabilizing NATO, in which case Europe wouldn't feel bound by any of the agreements we've made with Americans. Failing that, I don't think any of what was said above is relevant.
- bgnn 10mo agoASML has long lever against the Dutch government too. They keep threatening them to move to another country.
- maxglute 10mo agoNowhere close, but pace now seems faster than estimated, i.e. original western estimate is they won't even get EUV prototype up until 2030s. Right now their chips are already "economically" competitive, as in SMIC is starving on 20% margins vs ASML/TSMC/NVIDIA getting gluttonous on 50-70%, at least for enterprise AI. Current scarcity pricing = litho costs borderline rounding error, 1500 Nvidia chip flips for 30000, 6000 huawei chip flips for 20000. The problem is really # of tools access and throughput. They can only bring in so many expensive ASML machines, including smuggling, which caps how much wafers they can afford to toss at low yield. They figure out domestic DUV to 2000 series and throughput is solved. Hence IMO people sleeping on Huawei 9030 on 5nm DUV SAQP, still using ASML DUV for high overlay requirement processes, domestic DUV to fill rest. But once they figure out SAQP overlay, which will come before EUV, they're "set". For cost a 300m-400m ASML EUV, PRC can brrrt tools at BOM / cost plus margin. Think 40 domestic DUVs and associated infra for price of one ASML EUV to run 8x lines with 30% yield and still build 2x more chips normalized for compute that they can run on cheap local energy to match operating costs. Then they have export shenanigans like bundle 5nm chips with renewable energy projects and all of sudden PRC data center + energy combo deals might be globally competitive with 3/2nm. Deal with our shitter chips for now, once they deprecate we give you something better when our processes narrows gap, and you have bonus power to boot because some jurisdictions, building grid is harder than building fabs.
- DoctorOetker 10mo agoHow does one even smuggle an ASML machine? I'd assume the machine stops working if the GPS position doesn't compute, at end of life I wouldn't expect ASML to allow these devices nor their components to end up on the second hand market, I'd expect the future transfers to require continued permission of ASML, much like weapons distribution.
- cryptonector 10mo agoThe machines live indoors, far from being able to see GPS signals. Sure, you could require that there be an antenna run to the roof, but you can spoof that stuff. The thing that helps prevent smuggling of ASML machines is that a) there are few of them (i.e., people would notice), b) it requires tremendous effort to move them at all, let alone without anyone noticing.
- htrp 10mo ago> even if they use older machines and run longer exposure times How do longer exposure times and older machines enable 2nm process nodes?
- CamperBob2 10mo agoIf you didn't care about exposure time, you could build 2nm chips with brute-force electron beam lithography. But the limited throughput confines EBL to research and very low-volume applications. ASML's EUV-based processes are what permit industrial-level scaling, ultimately because parallel beams of electrons repel each other while parallel beams of photons don't. I don't personally understand why suitable EUV light sources are so hard to build, but evidently, they are. It sounds like a big deal if China is catching up in that area.
- bgnn 10mo agoThey can do 7nm and 5nm. Multiple patterning basically. I don't know when it doesn't scale anymore. Moat likely 4x patterning is the max you want to do.