ASML, the story of a European giant that has long remained in the shadows – L’Express

ASML the story of a European giant that has long

The ASML success story is, in itself, an excellent story. In Focus: The ASML way (Editions Balans, April 2024, in English), Marc Hijink, journalist for the Dutch daily NRC, tells how this company started with next to nothing 40 years ago, from Veldhoven, in the discreet suburb of Eindhoven in the Netherlands, forged “a key role in an industry which today weighs more than 600 billion dollars a year. The electronic chip industry, both the brains and nervous systems of our smartphones, televisions, cars, satellites, medical scanners… Tomorrow, of our artificial intelligence (AI).

ASML’s latest product alone sums up all the power acquired by the firm. The one that Marc Hijink describes to us as the “most complex machine on Earth”, is as long as a bus, stretches three meters high and almost four meters wide with pipes, conduits, cables and other lasers. This “giant printer” is not only essential for etching semiconductors onto silicon wafers – the basis of electronic chips. It is also the only one to be able to carry out this delicate process in such a fine manner, thanks to EUV (extreme ultraviolet) light wave lithography technology, acting with a precision of the order of a nanometer (thousandth of a millimeter). The diameter of a hydrogen atom, increasing the performance of said chips tenfold.

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“In four decades, very little has changed in the way ASML does things. The machines have just become bigger and bigger – which may seem crazy – as the chips have gotten smaller,” confides Hijink at L’Express. So much so that these behemoths are now only transported with immense caution via half a dozen 747 type wide-body aircraft. Their price, around 400 million euros, is itself comparable to a latest generation Airbus. The growing needs for chips, today for AI and its entire infrastructure, have offered bright prospects to ASML, which easily sells its instruments to foundries Intel, Samsung and TSMC. A bit as if, in Veldhoven, in the Brabant region, tulips bloomed all year round.

One day, the competition

But this pretty picture suddenly turned black. In Focus, Marc Hijink thus dwells on the two concomitant upheavals of Covid-19 and the trade war between the United States and China. A moment when “all the attention of the world was suddenly focused [Focus, en anglais] on ASML”, indicates Marc Hijink. The Americans very quickly understood the importance of the Dutch company in the semiconductor value chain. By making it a central domino of their strategy aimed at depriving the Middle Kingdom of these chips , and by extension, new technologies The pressure from the United States on ASML has materialized in a ban on sales of its best machines to China. Perhaps tomorrow a maintenance ban on all the others already on it. place A major upheaval, while the Asian country remains, by far, its largest market.

Business losses are a cause for concern in the short term. This represents 10 to 15% fewer sales in its mid-range products (so-called DUV machines). The current momentum around AI chips, however, reassures the company, which continues to grow. The real problem is more in the long term. ASML’s technological advance is currently in the order of “10 to 15 years”. But the more the United States’ influence over its rival increases, the more this estimate tends to melt away. “China must now look for alternatives for its production,” explains Marc Hijink. “It already has a lithographic machine building company, Shanghai Micro Electronics Equipment (SMEE). It could therefore opt more often for their machines which are perhaps be less good than those of ASML Then be obliged to invest to improve them, with consequently new generations of more efficient machines And so on… This is a danger that ASML perceives very clearly. China, moreover, returns the blows it receives. She inquires. Hack. Advance. Recently, the release of a 7nm chip from local foundries, for the benefit of a Huawei brand smartphone, set the Western world in turmoil. “What can be done in Brabant can also be done from Beijing,” ASML leaders lucidly observe about their instruments.

“Martin van den Brink could be very direct and brutal, sometimes rude”

So we have to innovate. Make the competition more difficult. Return to the starting point. ASML, with its Taiwanese client TSMC, the most advanced chip producer in the world, carries Moore’s laws at arm’s length. Briefly, these state that the density of semiconductors present on a chip doubles approximately every two years. ASML’s fine engraving has long allowed it to align them with each other, in a “horizontal” manner. The principle formulated by Moore in the 1960s is now increasingly difficult to follow. ASML’s new bet therefore consists of relaunching it, this time thanks to “vertical” advances. “It seems possible to cram more semiconductors on the same surface,” notes Marc Hijink. A bit as if “the fleas currently only had one or two floors, and we wanted to give them more height”. Make them into microscopic skyscrapers.

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This colossal technological challenge will, however, have to be accomplished without its leading duo of leaders: Martin van den Brink and Peter Winnick. This is the other turning point in the history of ASML. The two associates, at the head of the company since 2013, retired on Wednesday April 24. The second will notably take care of a vineyard that he acquired in France. Focus focuses a lot on their journey. Van den Brink, in particular, had been there since the beginning of ASML. It embodies the technical “consciousness” of society. Its DNA: “a start-up spirit in a multinational”. Its “local” guarantee, too, while ASML is deployed throughout Europe and the world. “ASML’s organizational culture is based on constant questioning, even within the hierarchy. And I think that’s something very Dutch,” highlights Marc Hijink. The harshness of a merciless environment, where error is not allowed. Van den Brink is described by Hijink as a “direct and brutal, sometimes rude” character. But its risk-taking, in particular to push the company towards EUV lithography technology, is unanimously welcomed in the sector. Even giving it legendary status, like “Morris Chang”, the father of TSMC. Winnick brings with him the reputation of a skillful, much more diplomatic manager. In the duo, the role of the good cop.

A Frenchman at the helm

Christophe Fouquet, 50, replaces them. Alone. “I think his main challenge will be to maintain the culture, the state of mind,” said Marc Hijink. The profile of the Frenchman, present at ASML since 2008, arouses confidence. “He has solid technical training, knows the most important clients as well as the local culture. He is married to a Dutch woman, lives in the area…”, points out Hijink. A priori, ASML should not change course under his leadership. His mandate is off to a good start. The Dutch government has just granted it 2.5 billion euros for the development of the company. The State had set up a real project, “Beethoven”, in order to keep its treasure close to it.

Because, put under tension by the geopolitical context, ASML recently mentioned leaving the Netherlands. “Executives were sort of suggesting that they could grow faster abroad than in the Netherlands, which is true. But the truth is, ASML wants to keep its brains in the Netherlands and stay close to its suppliers , many of which are nearby. The physical dimension is essential for this industry, in order to solve problems together,” continues Marc Hijink. After 40 years of history, Veldhoven remains the nerve center of ASML. And the European semiconductor sector.

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This false alarm was also a way of keeping the Netherlands and, more broadly, Europe, in focus. Concentrated. ASML has always lived in the shadows. “The Dutch did not have much knowledge of the industry. It was more of a service economy that dominated there. I myself have long perceived ASML as a somewhat obscure company, launched into complicated projects in relation to computing…” His notoriety was not more flamboyant in Europe. A recent portrait of Thierry Breton, by the daily newspaper Release, was amused by the late “discovery” of the Dutch nugget by the media European Commissioner. ASML nevertheless had one of the largest stock market valuations on the continent, hundreds of subcontractors particularly in Germany and France, and at that time already employed more than 40,000 people in 16 different countries. Who knew, deep down, that their latest iPhone probably wouldn’t be as snappy without the prowess of a European company? The European executive’s awareness of this hidden giant then led to the development of a real policy, the “Chips Act”, with an investment fund of more than 40 billion dollars, benefiting the entire ecosystem on the continent. And there was light. “Today,” notes Marc Hijink, “no one in Europe can ignore the importance of ASML.”