Now ASML machines are working, in particular, in the production cycle of Semiconductor Manufacturing International Corp. (SMIC). It is the largest supplier of chips in China. The company does not have its own specialists who could provide repairs. And if the situation with repair and maintenance does not return to normal in the near future, then this company is threatened with negative consequences of a rather large scale. It is likely that initially SMIC will be forced to reduce production volumes. And in the future – just refuse new orders that she will not be able to fulfill. And this means the suspension of the Chinese import substitution program, and the slowdown of the entire Chinese electronics industry in general.
There is another problem – the fact is that soon the United States will strengthen sanctions with another ban. This time we are talking about the impossibility of importing old models of ASML equipment for the production of silicon wafers into China. Most likely, the same SMIC will suffer the most because of this, although there are other chip manufacturers in China.
And all this should not happen sometime there, in 2024 or 2025. New rules restricting the export of equipment to China come into force as early as September 1, 2023. To export any modern lithographic machine that is capable of operating on the 7 and 5 nm process technology, a special license will be required. As far as one can understand, obtaining such a license would be extremely difficult.
There are other problems
We are talking about the fact that the products of Chinese companies supplying chips are lower than those of foreign companies. Officials are now investigating the causes of the situation. As far as one can understand, it is not easy, since by 2025 the Chinese plan to see the “first positive results” of current actions. The Ministry of Industry and Informatization of China announced the problem.
lies on the inspection bodies, as well as on the managers of different companies who are either new to or do not follow the necessary principles for tracking and controlling product quality.
In order to solve the problem, the Ministry of Industry and Digitalization of the People’s Republic of China will develop more than 100 models to improve product reliability. This is planned to be implemented by 2025. According to the authors of the project, such a plan will help a thousand or more of the most important enterprises to improve the situation with product quality.
Well, by 2030, new reliability standards will be developed and implemented for the Chinese industry. But all this will be solved within a few years, and problems with the volume of production of chips have already appeared. So far, it is unclear what the Chinese are going to do about this. So far, they have only stated their “deep indignation”.
Not only the Chinese and ASML will suffer
As it turned out, the largest American companies are also dissatisfied with the current situation. These are Intel, Nvidia, Qualcomm, whose heads recently met with representatives of the US presidential administration. The fact is that sanctions have a negative impact on the business of IT giants, so the company’s management is going to look for a way out of the current situation.
Qualcomm is the worst hit, as 60% of the company’s revenue comes from China. If it loses Chinese customers, then its semiconductor business will suffer greatly. Well, since Qualcomm’s business is billions of dollars, the US economy will also suffer. NVIDIA’s Chinese business accounts for 20% of the company’s total work, so this IT giant will also suffer.
Be that as it may, they seem to be trying to solve the problem, so more information will appear on the network in the near future. In the meantime, it remains only to wait – there is nothing to be done here yet.
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