china's bold €37 billion gamble on euv tech shakes semiconductor world
Beijing, Tuesday, 11 February 2025.
China is making waves with a massive €37 billion investment aimed at developing its own EUV lithography systems. This ambitious move is set to challenge established players like ASML, which has dominated the EUV technology market since 2019. For China, the technology is key to creating advanced and efficient semiconductor chips. ASML’s monopoly has been strengthened by export restrictions to China, imposed under U.S. pressure. Despite the financial commitment and burgeoning patents from Chinese companies like Huawei, experts remain skeptical about China’s ability to produce commercially viable EUV machines soon. The country’s reliance on foreign technology continues to be a significant hurdle. However, China’s entry into the EUV space could reshape the global semiconductor industry, intensifying competition and altering supply chain dynamics. This development reflects a broader strategic initiative to reduce China’s dependency on foreign tech. The world’s semiconductor landscape is poised for a significant transformation.
Market implications and stock volatility
ASML’s market position faces potential disruption from China’s ambitious entry into the EUV space [1]. The €37 billion investment announcement on February 10, 2025, signals China’s determination to break ASML’s monopoly [1][2]. While ASML has maintained exclusive control of EUV technology since 2019 [1], this development could impact investor confidence in the company’s long-term market dominance [GPT].
Technical challenges and expert assessment
Industry experts remain skeptical about China’s ability to achieve near-term success, citing complex technical barriers and dependence on Western expertise [1]. Professor Tsumoru Shintake from the Okinawa Institute of Science and Technology highlights potential innovations that could reduce energy consumption by 90% [1], but China’s domestic capabilities still lag behind current industry standards [1].
Patent developments and industry moves
Key Chinese players are actively pursuing EUV technology development. Huawei filed an EUV patent in 2022, followed by SMEE’s patent filing in 2023 [1]. The Harbin Institute of Technology is exploring alternative EUV generation methods [1]. These developments, combined with the substantial funding commitment, demonstrate China’s multi-pronged approach to achieving technological independence [1].
Supply chain dynamics
The global semiconductor supply chain faces potential restructuring as China pushes for technological self-sufficiency [1]. ASML currently relies heavily on Western suppliers [1], while operating under strict export controls to China since 2019 [1]. The Netherlands’ recent tightening of restrictions has further complicated the market dynamics [1], potentially creating new opportunities for emerging suppliers [GPT].