Canon, Huawei and SMEE trying to dethrone ASML
The Economist examines ASML's position as the sole manufacturer of advanced lithography machines essential for cutting-edge AI chips, and the emerging chllenges to its dominance.
ASML is now world-famous for one thing: it’s the only company on Earth that can build extreme ultraviolet (EUV) lithography machines—the $350M+ behemoths required to make sub-7nm chips. No EUV, no cutting-edge AI chips. TSMC, Intel, Samsung—all depend on ASML.
Their newest machine is a 150-tonne engineering marvel. It uses lasers to vaporize molten tin, generating plasma 40x hotter than the Sun. That plasma produces 13.5nm EUV light, which is guided by mirrors with atomic-level precision—inside a vacuum, because EUV can’t travel through air. High-NA versions now push resolution limits further, with throughput above 180 wafers/hour.
ASML also owns 90%+ of the market for older lithography tech (14nm and above). But challengers are finally circling.
Canon is pushing nanoimprint lithography: cheaper (40% less), faster to build, and useful for displays and memory. But it’s slower, less precise, and not ready for the most advanced chips.
Huawei , blocked from ASML’s tech by US sanctions, is building its own EUV system. Their approach—laser-induced discharge plasma—is simpler and potentially more energy-efficient. First production trials are slated for late 2025, with scale-up in 2026. Performance, yield, and integration are still unknowns.
SMEE , China’s state-backed lithography firm, is making progress on older deep UV tools (28nm). But scaling to EUV requires replicating ASML’s entire supply chain of 5,000+ specialist suppliers—no easy feat.
Lithography isn’t like software—leadership takes decades to build. ASML’s dominance is real, but the global race to replace or replicate it is now underway. Whoever controls next-gen lithography controls the pace of AI and computing.
