ASML and Taiwan Semiconductor Manufacturing (TSMC) have the ability to disable the world’s most advanced chip-making machines should China invade Taiwan. This information, from insiders, comes amid concerns from the U.S. government about the security of the semiconductor sector. Taiwan plays a crucial role in the production of advanced semiconductors, a sector in which a possible Chinese attack could have global implications.
Why this is important:
In the shadow of geopolitical tensions, two technology giants are poised for unprecedented action. ASML and TSMC may shut down their state-of-the-art chip-making machines in the event of an escalation of China’s conflict with Taiwan. The move is a direct response to U.S. government concerns about the impact of a possible Chinese attack on the island that plays a key role in the global production of advanced semiconductors.
Strategic value of Taiwan’s semiconductor industry
Taiwan accounts for about 90% of the production of the world’s most advanced chips. ASML is known as the only manufacturer of extreme ultraviolet (EUV) lithography machines. These are essential for manufacturing the latest generation of semiconductors. TSMC is the largest buyer of these machines. A Chinese invasion and subsequent disruption of this industry would lead to global shortages and economic chaos.
ASML’s unique position
ASML’s machines are crucial not only because of their technical capabilities but also because of the geopolitical implications. The Dutch government is currently banning the sale of EUV machines to China, and the U.S. has intervened to stop the export of ASML’s chip manufacturing machines to China. These actions underscore the strategic importance of ASML’s technology and the potential for power shifts in the global technology market.
Advanced technology as a power tool
In addition to ASML, TSMC plays a prominent role in this force field. TSMC Chairman Mark Liu has suggested that any military invasion of Taiwan would render TSMC factories unusable. It is a warning that demonstrates the gravity of the situation and highlights the far-reaching implications for the global technological infrastructure and economy.
These developments show how advanced technologies can serve as tools of power in international relations. The ability to remotely disable chip manufacturing machines gives ASML and TSMC a significant amount of control and influence. It illustrates the vulnerability of supply chains and how technological dependencies can lead to political and economic power plays.
The impact on China’s technological ambitions
China is pursuing technological self-sufficiency and has made advances in chip design and manufacturing by companies such as Huawei. This is supported by government initiatives. Nevertheless, access to the most advanced chip manufacturing machinery, such as that of ASML, remains essential to realizing these ambitions. Restrictions imposed by the West, such as those on the export of EUV machines, are a significant obstacle to China’s technological progress.
The way forward for chip makers
TSMC recently stated that for its next-generation chip manufacturing technology, the A16 node expected in the second half of 2026, it does not necessarily need ASML’s new generation of “High NA EUV” machines. This suggests a possible shift in strategy by chip makers, who must weigh whether the benefits of shrinkage in chip design outweigh the higher costs and whether older technologies may be more reliable and sufficient for their needs. The High NA tools are estimated to cost more than 350 million euros each, significantly more than the 200 million euros for ASML’s regular EUV machines.
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