By Toby Sterling
ANTWERP, Belgium, May 20 (Reuters) – The booming global semiconductor market will be “tense” with tight supply for the foreseeable future, the head of chip-making machine giant ASML told Reuters, with demand from AI, satellites and robots outpacing what the industry can produce.
In a rare interview on the sidelines of a tech event in Antwerp, ASML Chief Executive Christophe Fouquet said that there would likely be sporadic bottlenecks throughout the supply chain of the chip market which could hit $1.5 trillion by 2030.
“Demand on AI is coming so strongly that we will be in a supply-limited market for quite a while,” Fouquet said, citing plans like Elon Musk’s huge proposed “TeraFab” AI plan and Starlink satellites as potentially driving a new leg of demand.
ASML, Europe’s most valuable firm, dominates the market for systems used to print the tiny circuitry on high-tech chips. Its most advanced tools are essential for producing logic chips used in AI, as well as the memory chips needed alongside them.
Tech firms are spending hundreds of billions of dollars to build data centres packed with AI chips, forcing chipmakers like Nvidia partner TSMC, Samsung Electronics, SK Hynix, Micron and Intel to rapidly ramp up capacity. All use ASML’s tools.
Fouquet said ASML is boosting output and increasing the productivity of its tools as it tries to keep up, with new technology on the way. But he cautioned the size of the boom is hard to predict and could overwhelm industry planning.
MUSK’S TERAFAB, STARLINK WILL DRIVE HUGE CHIP DEMAND
Fouquet said a plan like Musk’s TeraFab, a large-scale chip plant intended to supply Tesla, xAI and SpaceX, would stretch toolmakers’ capacity over the coming years and it may materialize.
“He’s very serious about all those projects,” he said, adding he had talked with Musk, without providing details.
“One of the most fascinating projects for me is Starlink because we talk a lot about chips, humanoids, self-driving cars, and all those products have to be connected to data,” he said.
Fouquet expects that the first logic chips will be made within months using ASML’s new High NA EUV tool, which enables smaller chips and is set to be a key driver for the firm in the years ahead, with Intel set to be an early adopter.
Product data for both logic and memory chips made using High NA is coming this year, Fouquet said.
He said ASML is also developing a new advanced-packaging tool, its second, that will help manufacture physically large AI chips. The new products represent diversification for ASML.
“Right now it’s a small leg,” he said. “But in the future, this presents a new opportunity for ASML.”
EU NEEDS TO CUT RED TAPE, REFORM AI ACT
Fouquet, one of Europe’s most high-profile tech leaders, said the bloc risks being left behind in the industrial-adoption phase of AI due to red tape.
“People are attracted by the EU market, but they are usually scared about the amount of regulation and the complexity you have in Europe to do anything,” he said, adding that the bloc should scrap or revamp its2023 AI Act.
He called for more consistent rules around exports of chipmaking equipment to China. U.S. lawmakers in April proposed a law forcing allies to abide by U.S. restrictions, including a potential ban on sales to China of DUV products made by ASML.
The Dutch government has protested. Fouquet said the lower-tech DUV tools it sells to China are based on technology introduced in 2015 – eight generations of chip technology ago.
He warned that tightening restrictions further would accelerate China’s efforts to develop its own rival tools.
“If I put you in a desert and tell you you’re not going to have access to food anymore — how long does it take you to make your own garden?” he said. “It’s a matter of survival.”
(Reporting by Toby Sterling; Editing by Adam Jourdan and Bernadette Baum)
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