CEO ASML: China’s stricter export rules will affect all of us

“Chinese chips are in everything, they’re between 15 and 25 percent of global production,” Weinink says. “With the chip shortage we’re already experiencing, if we add another shortage to that…it’s going to affect all of us.”

Significantly higher turnover

The chip maker has – once again – had a strong year. The company is from Feldhoven Sold for more than 21 billion euros for machines. This represents an increase of 14 percent compared to 2021.

Profits were €5.6 billion, down slightly from the previous year. The company attributes this to higher personnel costs, among other things. In addition, more money was spent on research and development (R&D) last year.

Well filled out order book

The group is optimistic about this year. The company expects at least a 25 percent increase in sales volume compared to last year. If this materializes, ASML will sell more than 25 billion euros of machinery in 2023. The company’s well-filled order book justifies optimism: it contains orders worth 40.4 billion euros.

Of these, orders worth about 6 billion are directed to China. This is exciting for the company. The United States is putting a lot of pressure on the Dutch government to impose stricter rules on the export of ASML technology.

Manufacturer’s leading EUV machine (intense ultraviolet radiation), it may not be shipped to China. Sale of less advanced DUV machines (Deep UV) is still allowed. The United States would like to limit this, because the chips made with it can also be used for military purposes.

Effect

Last week, Prime Minister Mark Rutte visited US President Joe Biden to talk about this issue. There will be no export ban for now. Don’t leave the case and wink cold “of course”. “But that’s kind of what it is.”

He says geopolitical decisions are beyond his control. “It can keep you up at night, but it won’t help. So I still sleep well.”

The fact that ASML does not make decisions does not mean that the company is not trying to influence them at all. “Of course we are in contact. Our role is to provide information. Explain the consequences,” Weinink says.

Enough question

Weinink says the consequences for the company aren’t too bad. “As long as nothing changes, we will continue,” says the CEO. And suppose there is a ban? “Customer demand is more than we can make. Anything one customer doesn’t need can always go to another customer.”

The CEO, whose term as CEO expires next year, says the consequences for the economy are even greater. “A lot of chips are needed: for cars, power shift. Capacity has to grow.” It takes time to bring production to Europe. “It’s not like you can crank that up overnight.” According to Wennink, there is a “five-year gap” for building factories in Europe that can bridge Chinese chip production.

Provide information

That there is no decision yet, “what is it.” “This is what we have to live with. What comes out, comes out,” Weinink says. His company provides information only to clarify the consequences of any measures. “And you can only hope that people will listen carefully.”