Japanese Canon is developing a new generation of lithographic equipment for semiconductor production, able to compete with the products of Dutch ASML, which is almost a monopolist in the market of such solutions.The new plant in Japan will also be a response to competitors' investments in the related area in the United States, South Korea and Taiwan.Image source: CaponThe investment is expected to total $345 million, including construction costs and installation of production equipment.The plant will start production in the spring of 2025.As a result, the company will double its production capacity in this niche.Not only does the company intend to expand production, but it is also betting on new technology that will make it possible to produce next-generation semiconductors at low prices.Today it makes lithographic equipment in two factories in Japan which is used to produce chips for car control systems, for example.The new plant will be built on a 70,000 m2 plot of land on the site of an existing facility.This will be Canon's first new lithographic production facility built in 21 years, with construction starting in 2023.In 2022, lithographic equipment sales are expected to grow 29 percent year-over-year to 180 machines - a fourfold increase from ten years ago.The new plant will help meet growing demand.According to World Semiconductor Trade Statistics, last year the global semiconductor market exceeded $500 billion for the first time in history.The industry expects it to exceed $1 trillion in 2030.Today, Canon controls 30% of the global lithographic equipment market by volume, second only to ASML, which accounts for 60%.Intel and Taiwan Semiconductor Manufacturing Co.(TSMC) announced plans to build their own new plants in the U.S.and other countries.The company has also developed next-generation technology called nanoimprint lithography.It makes it possible to produce cutting-edge microchips at a lower cost than existing lithographic equipment.The process is simplified thanks to a technique that allows you to literally \"stamp\" the patterns of integrated circuits, which can significantly reduce production costs - the development of technology involved Japanese Kioxia and Dai Nippon Printing.Today, the most indispensable technology using EUV lithography to form circuits at the nanometer level.The only source of such technology today is the Dutch ASML.Nevertheless, such equipment is expensive, costing about $138 million per machine and consuming a lot of energy.If nanoprinting lithography reaches the stage of practical commercial use, Canon expects to reduce the cost of lithography by up to 40% and energy consumption by up to 90% compared to EUV.This will shake the dominance of ASML in the market.
ASML shares fell due to rumors that the U.S.is trying to cut off its supplies to China - shares of Chinese chipmakers on the contrary jumped
After the recent publication of Bloomberg about the pressure on the lithography equipment manufacturer ASML from the U.S.authorities in order to cut off supplies to China, the company's shares immediately went down in price.Paradoxically, the shares of Chinese semiconductor manufacturers after that began to rise in price.Image source: Laura Ockel/unsplash.comThe Dutch ASML, which is the largest supplier of advanced lithography equipment for chip production, some time ago already prohibited to supply its most advanced tools to China.Nevertheless, Bloomberg reported on a possible complete ban on supplies, including mature process machines.The source cited \"people familiar with the issue.\" ASML itself refused to comment on the rumors.After the publication Bloomberg share price ASML plummeted by 7.2%.Valuations fell cheaper and securities of other equipment manufacturers for chip makers - the company Lam Research by 3.6% and Applied Materials by 2.4%.Refusal to sell to China may be extremely unprofitable for the ASML - in 2021 about 16% of its sales accounted to the Celestial Empire for 2.1 billion euros.Each sold machine is worth hundreds of millions of dollars.At the same time, an export license is required to supply such tools.Since 2019, the Dutch government, under an agreement with the United States, denies ASML export licenses for sales of the most advanced machines for EUV lithography in the Middle Kingdom.Only less advanced DUV variants have been sold there.That said, most chips are still produced using DUV lithography and limiting sales of the machines in question could have a devastating effect on the Chinese semiconductor industry, with it likely exacerbating the global semiconductor deficit.In 2021, the US National Security Commission on Artificial Intelligence, chaired by former Google head Eric Schmidt, recommended that the US State Department and Commerce Department pressure allies with Securities for various Chinese chip makers rose 10 percent or more.China's chip manufacturing industry is growing faster than anywhere else in the world, and after the U.S.imposed sanctions on giants like Huawei and Hikvision, demand for locally made components only increased.According to Chinese industry representatives, prices are rising on expectations of import substitution by Chinese companies of foreign solutions.The share price in the Chinese segment was also fueled by preliminary, extremely optimistic data on the revenues of local Advanced Micro-Fabrication, which produces equipment for semiconductor production.In addition, fears that chipmaker revenues would be too low due to pandemic restrictions have not materialized to the extent expected.Finally, there is still no reliable data on the discontinuation of ASML sales.
A former ASML employee escaped trial in the US and set up a successful semiconductor business in China
Patriotism allows Chinese citizens not only to serve their country, but also to make big money.Zongchang Yu, an engineer who used to work for the famous Dutch chipmaker ASML, established Dongfang Jingyuan Electron in China and Xtal in Silicon Valley, USA a few years ago, after which ASML began leaking employees and presumably data.Source image: ASML According to Bloomberg, the two companies have worked in tandem, probably receiving technology and transferring it to China - the latter is in dire need of advanced solutions for creating advanced semiconductors, but because of sanctions can not get legal access to the most advanced technology and is forced to informally attract the cooperation of specialists working in the United States.Xtal was sued and during the proceedings she filed for bankruptcy.However, a lawyer representing the company argued that the company has not earned \"a penny\" on the technology received.In addition two employees of ASML were tried in the United States and suffered rather symbolic punishment in the local criminal proceedings, Yu himself managed to fly to China and now heads Dongfang, receiving substantial funds and benefits from the Chinese authorities.Beijing has taken unprecedented measures to close the gap with the West amid sanctions.In particular, in 2014, the country launched a $150 billion project to support the semiconductor industry in order to develop local manufacturing.According to the FBI, China often \"borrows\" intellectual property from Western companies and later uses it to compete with them.The Chinese Foreign Ministry calls such accusations \"malicious hype\" and argues that \"China does not make technological advances by stealing or robbing others.\"The Dutch ASML has the technology to produce the most productive computer chips and controls more than 90 percent of the lithographic equipment market.Some of the technology generates less than 1% of all revenues, but it is the key to creating advanced semiconductors.Before Yu founded the two companies, he was educated in China and then worked in Japan and the United States, including at ASML, which he left in 2012.After founding his own companies, he poached other employees from ASML.As it turned out, some of them had taken millions of lines of code out of the company, and when the investigation began, they began to destroy traces of their activities - on one laptop alone more than 60 GB of information had been erased.However, Xtal's lawyer claimed that other Xtal employees knew nothing about the illegal activity.Image source: Santa Clara County District Attorney's OfficeAccording to ASML, Yoo was behind the thefts.In this case, the company Xtal not only engaged in the transfer of technology to China, but also conducted business activities, only in January 2016, signed a contract with Samsung to supply specialized software for $ 27 million - previously the South Korean giant has cooperated with ASML in the same area.Although ASML directly pointed to theft of technology, the company preferred not to focus on the possible involvement of official Beijing, calling the topic \"speculation\" and said that several employees of Silicon Valley just wanted to get rich by stealing.It is noteworthy that the Chinese authorities themselves mentioned ASML a few months earlier, but quickly dropped any accusations.The problem with such companies is that many Western businesses prefer to gloss over sensitive issues, keeping both the public and investors and shareholders in the dark, since many do business in China and, among other things, would not want to get into new problems with the local authorities.Xtal's bankruptcy has had no effect on Beijing-based Dongfang's prosperity - in 2015, the company entered into an agreement with the Institute of Microelectronics at the Chinese Academy of Sciences to form a joint venture to develop semiconductor technology.Since then, Dongfang has been celebrated repeatedly by the authorities, and its head and founder has been lavished with millions of dollars by Chinese authorities.In an interview in 2020, Yu was called the \"standard-bearer\" of China's semiconductor industry.
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