China 15 years from matching top chipmaking tools, Zeiss exec says

China is roughly a decade and a half away from developing cutting-edge extreme ultraviolet lithography machines, according to a top executive at Germany's Zeiss Group Carl Zeiss Meditec AG ↘ 2.22%, whose optics are essential to the world's most advanced chipmaking equipment.

Frank Rohmund, who leads the semiconductor division at Zeiss, called it a "reasonable assumption" that Beijing will need 15 years to develop EUV lithography tools, though he noted China's progress is difficult to quantify, in an interview on Bloomberg TV this week.communicationstoday+2

A Decade Behind at Minimum

Rohmund's assessment aligns with a report published earlier this week by UBS ↗ 0.71% analyst Francois-Xavier Bouvignies, who wrote that China's lithography capabilities are "at a similar stage to ASML ↗ 2.81% in 2004" and unlikely to produce a viable EUV alternative within a decade. The UBS analysis, based in part on patent reviews, found that while Chinese firms could reach high-volume production of immersion deep ultraviolet machines within two to five years, EUV remains far out of reach.tomshardware+3

Zeiss is the exclusive supplier of optics for ASML's EUV systems, and ASML is the world's sole manufacturer of such equipment. EUV technology is essential for producing the most advanced chips powering Nvidia ↗ 0.90% artificial intelligence accelerators.business-standard+1

Export Controls and China's Response

The United States bars ASML from shipping its most advanced machines to China and requires export licenses for several of the Dutch company's more sophisticated immersion DUV models. Rohmund pushed back against calls to expand those restrictions to legacy DUV tools. "We don't believe in the positive impact of these export restrictions because it accelerates innovation in China," he said.communicationstoday+1

Despite these constraints, China has poured resources into building a domestic semiconductor supply chain. Shanghai Micro Electronics Equipment, or SMEE, reportedly introduced an immersion DUV system in 2023, but according to Tom's Hardware, no evidence has surfaced of mass production or adoption by chipmakers. Reports re-emerged in July about a Shanghai-based company producing immersion DUV tools, though details on performance remain scarce.tomshardware+1

AI Memory Adds a New Front

China's semiconductor push extends beyond lithography. ChangXin Memory Technologies, or CXMT, has begun small-scale production of HBM3E memory chips for domestic AI clients, according to KED Global, narrowing South Korea's lead in that segment to roughly three years. That progress poses a growing challenge to Samsung Electronics and SK Hynix ↗ 1.92%, which dominate the high-bandwidth memory market feeding global AI demand.kedglobal

"We are still way ahead," Rohmund said of Zeiss's position. Whether that margin holds depends on how quickly Beijing can close the gap — and how far Washington is willing to go to slow it down.business-standard+1