2023 Eschips perspective on the real development status of China's semiconductor industry
A meeting on export restrictions on Chinese chip equipment ended negotiations in Washington on January 27, 2023, with the United States, Japan and the Netherlands reaching an agreement on restrictions on exports of advanced Chinese equipment. After the conclusion of the trilateral negotiations, in March, the Netherlands issued restrictions on advanced lithography models to China, and in early April, Japan also issued relevant policies to restrict the export of 23 kinds of semiconductor equipment to specific countries. It can be seen that Japan and the Netherlands have officially entered the stage of legislative consultation, and the introduction of relevant legal provisions is imminent.
The author of the first round of negotiations between the United States and the Netherlands in December last year said that the seriousness of the matter, because in the past two years, a large part of the domestic semiconductor industry is to build the so-called non-US chip production line, and establish several non-US production lines to ease the pressure of the United States on domestic chip sanctions, and now the United States, Japan and the Netherlands reached a tripartite agreement, so that the domestic non-US production line has become very difficult. The advanced process equipment of the chip in the future may only be left with the domestic road, and there is no other way.
01.ASML lithography machine rumors?
On April 5, the market rumor was that the largest chip factory in China had 8 ASML advanced lithography machines delivered, of which 4 were 2050i and 4 were 1980Di, all of which could be used to make 14nm or even 7nm lithography machines. For a while, the market was jittery, and the stock market rose sharply on hearing the news, the author issued a clarification in the afternoon, confirming that there were 8 lithography machines delivered. But these 8 units are the castrated version of 1980 that should have been delivered last year but returned to the factory to change the hardware, not what advanced lithography machine, my clarification was forwarded by the industry and the media, and the stock price immediately returned to calm.
On April 18, a similar announcement was made, this time with 11 2050As and four 1950s. We need to know that ASML does not have the 2050A model, and the 1950 model ASML has long been discontinued. On the same day, another version of the 13 sets of 2050 lithography machines that can be 7nm have been made, which is the original TSMC lithography machine, and behind the rumors are domestic Foundry executives or ASML experts said that this kind of false news imagination is large, beyond imagination. Personally think that a variety of false news will always come out from the stock market group, nothing more than the relevant stakeholders deliberately released false news, and it is very likely that there are internal personnel involved, after all, at least they know that there are really 8 lithography machines to be delivered, because there will indeed be 8 before June can only do 28nm castration version 1980 arrived.
Why this kind of false news is common, the reason is very simple, is that people with ulterior motives, using the Japanese and Dutch laws have not been announced and the people hope that the semiconductor has good news mentality, with poor information to create false news and profit from it. The author believes that only by improving the transparency of the industry can such problems be eliminated, but I can say very responsibly that at present, participants in every link of the market do not want to be transparent, and there are huge interests involved, and our society's high expectations for breaking through the Western blockade have given the entire industry fertile soil for opacity.
02. Why are rumors always about lithography machines?
It is precisely because the current capacity of domestic chip manufacturing equipment has not reached the advanced level, so the domestic chip manufacturing has been mainly imported, and the United States has more and more restrictions on China after 2020.
In addition to the Dutch ASML lithography machine that we are familiar with in the non-US production line, Japan is also very key, because Nikon can also produce immersion lithography machines, and TEL Tokyo Electronics is the only manufacturer to replace the US AMAT, LAM key equipment. Therefore, the use of non-American production lines built by the Netherlands and Japan is a way to circumvent the technological blockade of the United States, and it is obvious that the United States is also aware of this, so there will be this trilateral meeting of the United States, Japan and the Netherlands.
The original text of the new regulations issued by the US BIS last year is to prohibit the export of advanced chip technology equipment such as FinFET and GAA to China, and FinFET technology refers to the process node below 16/14nm, so all US chip equipment below 16/14nm is prohibited to China. However, domestic chip owners can also buy chip equipment from Japan and the Netherlands to replace the United States, and the tripartite agreement between the United States, Japan and the Netherlands focuses on ASML and Nikon of lithography machines and Tokyo Electronic TE L, Japan's largest chip equipment manufacturer with full link technology, these three top chip equipment companies.
One of the most controversial is the lithography machine that everyone focuses on, because the process node of the lithography machine is not defined by how many nm, we use the immersion lithography machine, which can cover the process node of 45-7nm.
ArFi's DUV lithography machine process node is obviously disputed with the United States BIS for the restriction of 14nm below the provisions, if the equipment is prohibited, then all the domestic chips below 45nm are declared unable to produce, which is a big cut higher than the United States BIS limit, this is one of the focuses of the US-Japan-Netherlands negotiations, Specify the specific scope of the restriction and related parameters.
The ArFi lithography machine, which is also a 193nm light source wavelength, how to distinguish between 28nm and 14nm? In fact, ASML has a corresponding model, ASML can be shipped according to the model, of course, there are many common hardware and software, ASML will remove relevant functions before delivery to ensure that the equipment will not expand to a higher process in the future.
More than 30 sets of DUV immersion lithography machines for NXT1980Di above 28nm that were just purchased by a large factory in China at the end of last year will arrive one after another in 2024 without being affected.
According to the data of ASML, we can see that the most advanced DUVi lithography machine can achieve 7-5nm. From the table, we can see that the DUV light source of 193nm wavelength refracts through DI Water, and the numerical aperture can be greater than 1 of air, reaching 1.35NA. But even so, its resolution is only 38nm, so why can the chip be made to reach 5nm? The answer is in the multi-exposure technology, with the improvement of the precision of the workpiece table engraving, we can use SADP or even SAQP quadruple exposure to achieve the microwidth of the chip. In 2017, TSMC successfully achieved the first generation of 7nm mass production using 1980Ci and SAQP's quadruple exposure technology. Therefore, in addition to the immersion technology, the engraving accuracy of the workpiece table is crucial for the success of the immersion lithography machine to achieve 5nm.
Below 7nm, the process of using EUV lithography machine is completed by EUV+DUV and not by EUV alone, EUV below 7nm is mainly the metal layer with the least space, and the other layers are still completed by DUV.
So why can ASML ship only 28nm castrated version of the 1980 immersion lithography machine? The so-called castration version is actually to cancel the software such as lens control and calculation lithography, and build a workpiece with a precision of more than 5nm, and castrate the software and hardware at the same time, so that a 1980 that could originally do 7nm was eventually limited to 28nm.
In addition to ASML's lithography machines, the US-Japan-Netherlands negotiations also include Nikon as a focus, because Nikon also has the shipping capacity of ArF immersion, which has 14 orders for immersion lithography machines in 2020, seven in 2021, and four in 2022. The main customers of these more than 20 immersion lithography machines are Intel and Chinese enterprises.
After the negotiations between the United States, Japan and the Netherlands, whether ASML or Nikon is prohibited to export 14nm below the lithography machine to China, because the current domestic lithography machine progress is behind, so the future for a long time, the domestic will face no advanced lithography machine available, that is to say in the next few years, in addition to all 14nm below the fab will stop building new, Moreover, China's most advanced chip process will stay at the current 7nm for a long time.
There is a point to be clear, in fact, all the imported equipment manufacturers have been trying their best to help Chinese customers, especially in the past two years with the assistance of Japanese and Dutch equipment manufacturers, after the new regulations of the United States BIS, ASML has been under pressure from the United States, and the biggest reason for Nikon to vigorously develop the immersion lithography machine that was about to be abandoned in the past two years is also because of the Chinese market. Japanese equipment manufacturers have given considerable support to the construction of non-American lines in the past two years because they have almost no American technology. After the 10/7 new regulations last year, the United States equipment manufacturers are also as much as possible to assist Chinese customers, these imported equipment manufacturers are basically the same attitude, that is, to seek to maximize their own interests, because this is their rights and interests, as long as there is no law, the Japanese and Dutch governments can not intervene in their enterprises, the government has no power outside the law. Therefore, the implementation of the relevant agreement into law is the final step in the US-Japan-Netherlands containment of Chinese chips.
03. What is the attitude of the Japanese and Dutch governments?
At present, in addition to the rumors of various types of lithography machines of ASML, only ASML in the Netherlands has come forward to clarify that equipment above 2000i is an advanced process, but this is only a unilateral statement of ASML as an enterprise in business, and the attitude of the Dutch government is the final key. However, the Dutch official has not been relaxed, but in early April, the Japanese Ministry of Economy, Trade and Industry officially announced the list of 23 kinds of semiconductor equipment restrictions and detailed specifications for unfriendly countries.
According to the parameters published by the Japanese Ministry of Economy, Trade and Industry, a detailed study determined that this is a higher limit than the United States BIS 1007 last year. In addition to the key chip manufacturing equipment, the regulation even a number of key components such as high-frequency pulse RF power are required, the level of detail can be seen in general.
The Japanese Ministry of Economy, Trade and Industry's restrictions on lithography machines are described as follows:
A step-repetition method or step-scan exposure device for processing wafers in which the wavelength of the light source is 193 nanometers or greater and is measured in nanometers.
By multiplying the wavelength representing the light source by 0.25 and dividing the value by the number of numerical apertures to a value of 45 or less (excluding the value corresponding to (1) 2).
According to Rayleigh's formula, the resolution of the lithography machine is R=kλ/NA, that is, the resolution =K1* wavelength/numerical aperture, the K1 process parameter is set as 0.25 in Japan, the wavelength of the DUV light source is 193nm, and the numerical aperture of the ASML immersion lithography machine after DI Water refraction is 1.35. That is to say, even without multiple exposures, the resolution of all immersion lithography machines is between 35-38, which is far beyond the Japanese Ministry of Economy, Trade and Industry's resolution of not less than 45nm, simply put, according to Japanese specifications all immersion lithography machines below 45nm have to be prohibited. This standard is much higher than the 14nm limit set by the US BIS 1007 last year.
In Japan, the rules are basically clear, just waiting for the law to be passed, but what about the Netherlands?
The relevant provisions of the Netherlands have not been clear, the Dutch government is also coy, but from the Japanese specifications, the United States, Japan and the Netherlands tripartite agreement for the lithography machine is 45nm, that is, immersion lithography machine demarcation line, if the Netherlands also really reached such an agreement, it will be a serious blow to ASML and China's semiconductor industry.
I believe that ASML will not sit still. I think ASML and the Dutch government are now in the stage of intense gambling, so Japan has introduced the bill early while the Dutch side has not made any further comments. This is an important event that we must pay close attention to. We hope that ASML CEO Peter Wen's visit to China for talks in April will be a positive signal and good results will emerge.
04. Outside of lithography machines, is China's chip equipment a smooth road?
In fact, not only lithography machine, China's chip manufacturing in many links is not able to produce nationwide, we take the 28nm production line of a large factory in China as an example, the overall localization rate is less than 20%. Domestic equipment manufacturers are indeed working hard to promote localization during this period of time, and Fab owners are also very cooperative to greatly relax standards, overtime to give equipment manufacturers certification, but at this moment in 2023, to 28nm, our localization rate can only reach 40% at most.
In addition to the lithography machine, 28nm chip process, including film deposition, ion injection, etching, CMP, coating development, cleaning, measurement and detection, degluing and so on all links, there is no process we can break 100% of the whole link, even the lowest threshold cleaning, degluing equipment can only achieve 50%-70% localization rate. In the process with the lowest threshold such as cleaning and gumming, the key link is still to use imported equipment such as Dean and Disco, not to mention other equipment with higher thresholds. And there is a more important point is that the last proportion of those devices in each link is more and more difficult key equipment, and the difficulty of tackling the problem behind will increase exponentially.
The information provided by the author is the real situation of the current industry, and the media or some domestic equipment manufacturers released here to break the blockade, there and tackle the completion of the domestic chip equipment seems to be only a link of the lithography machine is completely different, in fact, the key of each link can not be replaced, even if the threshold is the lowest link.
At present, all domestic Fab under the official promotion incentive, will try to pull up the localization rate, but this is a price to pay, that is, the yield has dropped significantly, and the yield needs more time to pull up.
Take the domestic Foundry factory as an example, the yield of the old 28nm line containing the United States can reach about 85%, while the new plant with 20% localization rate is less than 70%. It is conceivable that if the localization rate is further increased to 50%, the probability of yield will fall to 50% or even lower. The equipment has been unable to pull through the movie in nearly a year, as compared to TSMC's long-term 28nm yield of 98%.
We have to understand that the general Foundry needs to reach 8 yield rate to break even, localization brings domestic Fab advanced manufacturing process below 28nm, will be under the loss line for a long time, of course, the current domestic Fab receives a lot of government subsidies and a lot of policy support loans to maintain cash flow and profits, but this is not a long-term solution.