Brief history of Asml, the European (but bound to the USA) chip champion
History, technologies, revenues and American ties of Asml, the Dutch company "that matters but that no one talks about". The point of Alessandro Aresu, geopolitical analyst, taken from his profile
To celebrate 40 years of ASML, the champion of semiconductor machinery born in Eindhoven on 1 April 1984, a thread that starts from this unique color map, created by Laura Canali. The map illustrates "the world of ASML", i.e. the main production structures, the offices and the reference geographies of the company, the political-economic context in which its technologies operate.
ASML is a champion of the Netherlands: born from Philips laboratories and ASM International, it moved in 1985 with around 100 employees to Veldhoven, a headquarters that will grow greatly over time (today there are more than 20,000). ASML is a European champion: its main suppliers are European, in particular two symbols of German capitalism, Zeiss and Trumpf. ASML also has a share of approximately 25% of Carl Zeiss SMT, a company that we also indicate with a focus on Germany.
In the geography of revenues (who buys ASML's machines and services), East Asia prevails, where production capacity is concentrated. The USA is always relevant. We will return to China later.
The map shows an aspect that I have often explored in my writings, namely the US constraint on ASML. ASML's connection with the United States is more important than is commonly believed. For various reasons.
- Point number 1, albeit obvious: like the other main global public companies, ASML has some US funds among its major shareholders. It's not from the Dutch government!
- Point number 2: ASML entered the technological clash between the USA and Japan in lithography between the 1990s and the early 2000s as a "third wheel", and then triumphed. Essential passage without which the present cannot be understood.
In this path, ASML – authorized by the US government – has acquired important companies such as Silicon Valley Group, Brion, Cymer: especially in California and Connecticut there are now key ASML structures. The USA is therefore an important part of the production structure and platform, as well as a reference market and fundamental ally of the Netherlands. Even through these constraints we must read export controls .
The People's Republic of China, an important market for ASML already 5 years ago, paradoxically weighs even more in revenues today, also due to export controls. Why? In summary, Chinese customers, before they are no longer able to buy some machines, purchase them in large numbers, to have a "reserve effect" similar to that of Huawei with TSMC a few years ago. On the one hand, machine contracts also include services and maintenance; on the other hand, the USA extends the Sullivan Doctrine by widening and raising the threshold of controls, making the same services more difficult. These systole and diastole also include illicit aspects, such as the industrial espionage of which ASML was the victim, especially from the Chinese side, with growing attention from Dutch intelligence.
China has obvious incentives to develop an alternative to ASML (and other machinery players) – we will continue to read bombastic plans and announcements about this. It remains a difficult objective even in the medium term. In the future, due to the attempted manufacturing revival, the US share of revenues could increase, like that of the rest of Asia. In short, the more you build fairly advanced chip factories, the more ASML wins. Even in the medium term, ASML will maintain an important European identity. Why? The mechanism of the main suppliers is too powerful and specialized to be replaced, so Europe can preside over those niches with a certain effectiveness.
The last chapter of my 2022 book “Dominion of the 21st Century” is dedicated to ASML and opens with Civiltà delle Macchine. Imagine the wonder of Gadda describing the machines of Veldhoven! On Le Grand Continent I returned to ASML twice. In 2023 I remembered some reasons for its success and also the role played by Gordon Moore, which I will take up again in a selection of his writings. On April 1st I celebrated the fortieth anniversary of ASML and the retirement of its engineer par excellence, Martin van den Brink, a concrete, not just talkative, hero of European innovation. But now the company lets people buy its t-shirts in Europe too!
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/asml-40-anni-storia-aresu/ on Sun, 07 Apr 2024 05:17:47 +0000.