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The World Needs China’s Legacy Chips, ASML CEO Says

CEO of Europe’s top chip-equipment maker says the auto industry needs a lot more chips that are made using simpler, long-known technologies


The head of chipmaking equipment giant ASML says it is "essential" to retain access to China.
New ASML chief says Europe cannot produce half of the older legacy chips that it needs. Photo: Reuters.

 

Germany’s car industry and other chip buyers need the older generation computer chips that Chinese chipmakers are now investing in, according to the CEO of global chip giant ASML.

Christophe Fouquet, the new chief executive of top equipment maker ASML, made those remarks in an interview with Germany’s Handelsblatt newspaper on Monday.

Fouquet, who took over as boss of Europe’s largest tech firm in April, made the comments as the European Commission began surveying firms such as ASML for their views on Chinese firms’ investments in so-called “legacy” chips, which are an important source of revenue for ASML.

 

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“The automotive industry in particular, including the German one, needs a lot more chips that are manufactured using simpler, long-known technologies,” Fouquet told the paper.

Facing US-led restrictions on more advanced technology, Chinese firms are expanding capacity to produce these older chips, raising Western concerns about the long term potential for oversupply.

Fouquet said that global demand for such chips is rising dramatically, but making them is not very profitable and Western firms are not investing enough.

“Europe cannot even cover half of its own needs,” Fouquet said.

According to estimates by industry group SEMI, Chinese chipmakers will increase capacity by 14% in 2025, more than twice the pace of the rest of the world, to 10.1 million wafers per month in 2025, representing about a third of total global production.

“If someone wants to slow it down, for whatever reason, then alternatives are needed. There is no point in stopping someone from producing something you need,” Fouquet said.

 

  • Reuters with additional editing by Jim Pollard

 

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Jim Pollard

Jim Pollard is an Australian journalist based in Thailand since 1999. He worked for News Ltd papers in Sydney, Perth, London and Melbourne before travelling through SE Asia in the late 90s. He was a senior editor at The Nation for 17+ years.

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