ASML, the world's largest supplier of chipmaking equipment, is already prohibited from selling its most advanced extreme ultraviolet (EUV) lithography equipment, which costs around $164 million per unit, to its Chinese customers due to pressure from the United States.
Bloomberg reports that the US government is urging ASML to stop selling older deep ultraviolet (DUV) lithography tools to Chinese customers. The technology is still used today to create chips used in phones, autonomous cars, computers, robots, and other devices. The US is also threatening to prohibit the sale of the most advanced type of DUV technology, immersion lithography equipment, to China.
While DUV systems are mostly used for older manufacturing processes like 30nm, multi-patterning techniques may be used to make denser nodes, such as TSMC's first two generations of 7nm nodes.
The United States is attempting to persuade Japanese companies like Nikon to stop selling the same DUV tools to China, which has already banned many local firms from purchasing advanced chipmaking equipment from US businesses.
If the US wins, ASML's bottom line could suffer. Last year, Chinese chipmakers contributed 14.7 percent of ASML sales. SMIC, China's largest chipmaker, plans to invest $11 billion to expand its DUV capability by 2023.
"The discussion is not new. No decisions have been made, and we do not wish to speculate or comment on rumors," said an ASML spokeswoman.
Chen Wenling, the chief economist at the government-run China Center for International Economic Exchanges, urged China to seize Taiwan's TSMC "if the United States and the West impose severe sanctions on China, such as sanctions on Russia."