Look like Samsung and TSMC are building production line with no American equipment
The chip ban gives the world an enormous incentive to circumvent the US
by
June 12, 2020
Huawei has plenty of ways to get around a US ban on chips. Photo: AFP
A US ban on foreign companies’ sales of chips to Huawei Technologies if American equipment or software is involved will undermine America’s already-weakened position in the global semiconductor equipment market, industry sources say.
Chip fabricators will remove American equipment from production lines in order to maintain market share in China, the world’s largest purchaser of semiconductors.
Samsung, the world’s biggest fabricator of memory as well as logic chips after Taiwan Semiconductor Manufacturing Corporation, already has set up a small production line for top-of-the-line 7-nanometer chips using only Japanese and European chip-making equipment, according to .
The Dutch firm ASML is the only provider of the Extreme Ultra-Violet (EUV) etching machines required to produce the tiny transistors on 7-nanometer chips, which can hold 10 billion transistors on a silicon wafer the size of a fingernail. Chip testing machines by Japan’s Lasertec sell for US$40 million apiece and are rated the best on the market.
Samsung and Huawei are considering a deal under which the South Korean giant would fabricate advanced chips for Huawei’s 5G equipment, and Huawei would in effect cede a substantial amount of its smartphone market share to Samsung, I reported in
May 20. Mobile phones are Samsung’s flagship business, but they are a relatively small contributor to profits at Huawei, whose core business remains telecommunications equipment.
Ban ‘unacceptable’
South Korea exports almost twice as much to China as it does to the United States, and it relies on China to restrain the erratic North Korean regime. Seoul told Washington that the ban on sales of chips made with American equipment to Huawei and other Chinese companies was “unacceptable,” according to industry sources.