00:00The U.S. now telling the ASML it's a concern China may have a top chip tools.
00:06The Commerce Secretary Lutnik expressing those concerns to ASML's senior leadership.
00:13This Bloomberg has learned, of course, is a key issue, especially given that it could be a big
00:20breach of Western semiconductor export controls. Let's bring in technology executive editor Tom
00:26Giles. Tom, how significant is this? Yeah, if this is true, this would constitute a major
00:35violation of, as you said, these export controls that the U.S. has placed not only on U.S.-based
00:42companies, but it's also imposing limitations on the kinds of exports, the kinds of transactions
00:49that happened between other countries, such as the Netherlands and Japan, major U.S. allies.
00:57And this is all part of the big picture here is, as we've discussed so many times on your show,
01:03U.S. efforts to basically make it more difficult for China to get its hands on the most advanced
01:10AI equipment. And of course, ASML is the maker of these big EUV machines that are used in the
01:19manufacture of the most advanced chips. And if one of these were to end up in China, and these
01:26restrictions have been in place for several years now, dating back to the first Trump administration,
01:31that would be a major violation. Now, to be very, very clear, ASML has denied that any of this is
01:39going
01:39on. It's denied that there are EUV machines or even one EUV machine. It is denied that it has played
01:46any role in the export of even the kinds of tools that are needed to transport and to basically fine
01:54tune EUV. So ASML is very clear in its statements to us and its statements to the U.S. government.
02:03And to kind of put into context, the lack of access to these types of machines is really the
02:09the biggest hurdle that China and China's companies are facing. Is that what we're hearing from the
02:14likes of Huawei? Or is there a workaround that they've been managed managing to find?
02:19I think if you talk to the chip experts and the chip manufacturers in China, they will tell you that
02:24they are finding ways around it. But there is no actual immediate and comparable substitute for
02:32these EUV machines. Remember, these go for hundreds of thousands of U.S. dollars.
02:36They're the size of a school bus. They're incredibly, incredibly sophisticated and complicated.
02:44And it's not like you can just kind of tear one down and replicate it immediately. It represents
02:50years and years of advanced fine tuning on the part of ASML. And this is the thing that makes ASML
02:58such
02:59an important part of a linchpin, if you will, in Europe's efforts to advance its own chipmaking
03:06capabilities. And it has made ASML the most valuable company in Europe. And it has made ASML integral to
03:15this larger trade war that we talk about every day that is playing out between the West and China.
03:21ASML.
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