Sir It's too late then the US had achieved their objective, the ideal scenario is by 2024 a domestic 7nm line is up and running IF NOT then they had successfully stymied Chinese AI, data servers and others tech development that require 7nm chip process node. The next target is SMIC to fully realized their policy and I hope SMIC is wise enough to have a back up plan in their production process.
Chinese semiconductor industry
- Thread starter Hendrik_2000
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I dont offer my opinion because i dont have sufficient knowledge about it. Im a layman regarding this (and other matters here in SDF). But i can discern enough to make them. And besides, if you claim that they are stupid questions, then why dont you answer them? it should be easy. Then, i will know if they are stupid or not.
It is an important part of this discussion, IMO. Also i said "AFAIK". So, i dont claim to have absolute knowledge about it. If you know of any retaliation from the part of the chinese government, please present it.
IC is the one space where the US currently has intense inside knowledge 1) US Suppliers 2) Pressuring any American working in China. These sanctions will only make things more opaque literally no Americans left working in Chinese IC now.
The only response China has is to build stuff (see aerospace). Look if you make AMAT/LAM etc… replacements you now have a muli-billion/yr mkt to yourself. Not an ideal situation … from CNH perspective nothing has changed from 2015 just the US totally freaking out.
Everything is on the cusp. Just need equipment news or end product news - waiting game on that now.
We have talked about it and it boils down to China not retaliating tit-for-tat because China is more into being a reliable partner that everybody trusts, while the American sanctions lobby harm their own interests by being the unreliable partner. America has been able to sanction countries into oblivion because of their size, market and technology monopolies. China does not play the sanctions game because it doesn't need to. It has the market, the capabilities and the good will of the majority of the world to be able to overcome sanctions, unlike no other country. That's why you will only ever see China do piecemeal retaliation to satisfy the lynch mob and to save face, but not actually go all out because they don't need to. That's also why this is an investment opportunity for the ages.
Also this behavior is why more and more global south nations prefer working with China over the US. (See the entire middle east)
Saudi Arabia and Iran finding themselves on the same side of a war, even an economic one, is something no-one saw coming and yet here we are.
You are conflating different things here. VW deal with Horizon Robotics is about EV supply chain. That one China definitely dominates. Notice, it is China's willingness to work with everyone that has allowed it to dominate the space.
Also Horizon Robotics is not a startup. It is the dominant auto CPU supplier in the Chinese market.
I'm surprised it's only $400 million. I don't know why any company in China would continue to work with them if they cannot provide even the most basic servicing requests. I don't see how they can collect any more servicing charges on equipment they've already sold to China.
It's quite possible that they are only estimating this amount because they are anticipating that things will quiet down after the midterms and that they will get exemptions to at least service stuff they already sold.
Other than that, if American companies cannot even service Chinese fabs that are building mature nodes, why would they buy from American companies? It seems like a fantasy for AMAT to only project like a 5 to 10% loss. They are heading for 25% loss from losing the entire Chinese market.
The most ideal case for China is for things to loosen up a little bit after midterms (like it already has with Nvidia). Then, Chinese fabs will be so spooked by what happened that they will just have American companies fulfill existing orders and not any new ones.
I think it's up to China to find ways to keep as many of the senior Americans to work in Chinese semi industry as possible by offering them quick path to citizenship and allow them easy path to get dual citizenship or PR elsewhere (like Singapore or Australia or Canada). US can pressure Japan to not sell their equipment to China, but they clearly did not succeed in this case. This law came through in a hurry before the midterms.
In a time where the entire industry is reeling, Japanese businesses will be pressuring their government to maintain all open sales. Same with Dutch government. ASML probably has significant influence over them. I mean these companies can just tell their government that letting Chinese competitors grow is a terrible thing for them.
Having said that, I think Chinese fabs will identify the areas that they are most at risk (where domestic suppliers are least capable of replacing foreign suppliers) and stock up in those areas. And obvious move would be to buy as many ASML scanners as possible.
As for what China can do to retaliate. It's not clear to me what the right move is. If they really want to go crazy, they can put in laws to prevent any Chinese nationals from working for American semiconductor industry. That actually would really hurt. I don't think they will do that. US government already has done a great job of putting their own companies out of business by spooking all their potential Chinese customers. The smartest thing China can do is to make working in China and building fabs in China more appealing for foreign nationals and firms.
What China wants is not more foreign tools but rather more talented foreign talents and knowledge base.
You said Horizon Robotics is providing AI chips for self-driving. The way it is going, it is only a matter of time the company ends up on an American entity list.
For ASML, US employees barred from aiding China include US citizens, green card holders, foreign nationals living in US.
A message from ASML management to its employees.
In case anyone wondering about the veracity of the message
David Kim is currently head of Legal & compliance for ASML US
A message from ASML management to its employees.
In case anyone wondering about the veracity of the message
David Kim is currently head of Legal & compliance for ASML US
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