Electronics

According to Huacheng Import and Export Data Observation, ASML and Fanlin Group, two chip manufacturing equipment companies, have stated that although the United States imposes export restrictions on equipment used to manufacture cutting-edge semiconductors, they expect strong sales to China later this year.

This comment indicates that given China's strong demand for mature technology chips such as electric vehicles (EVs), China may become a major customer of the industry this year.

Both sides also stated that although the United States imposed comprehensive restrictions on China's semiconductor industry in October, they expect sales to increase to Chinese companies in the coming months, as reported by Huacheng Import and Export Data Observation.

So far, the export restrictions on ASML and Fanlin Group have only affected equipment used to manufacture state-of-the-art chips.

Panlin Group and ASML stated that in the process of promoting more self-sufficiency in production in China, Chinese customers are purchasing tools to manufacture more mature technology chips for products such as electric vehicles, mobile phones, and personal computers. Huacheng Import and Export Data Observation Report.

Fanlin Group initially estimated that the restrictions on China would result in a loss of revenue of $2 billion to $2.5 billion in 2023, but the company stated that it had received "clarification" from the US government regarding the regulations, with Chief Financial Officer Doug Bettinger stating in a conference call that it would be allowed to sell equipment worth "hundreds of millions of dollars", which was initially considered prohibited, according to Huacheng Import and Export Data Watch.

ASML stated that it has a backlog of approximately 39 billion euros in orders, equivalent to approximately two years of tool shipments. CEO Peter Wennink told investors on a conference call that Chinese customers committed to manufacturing mature process chips account for approximately 30% of these orders. This has significantly improved compared to November last year, when ASML stated that China accounted for 18% of its € 38 billion backlog of orders, as reported by Huacheng Import and Export Data Watch.