Photolithographic teams that make chips need their own chips. And there is bad news: they are also scarce

The semiconductor deficit goes a long way. Pat Gelsinger, the CEO of Intel, predicted last year around this time that during 2023 we would possibly begin to look on the horizon the end of the crisis of integrated circuits, but it seems that this situation will last longer than the experts expected.

And it is that Peter Wennink, the executive president of ASML, foresees that the production of chips will continue to be lower than the demand for at least the next two years Due to the challenges faced by manufacturers, they hardly have room to increase their performance further.

This Dutch company in which Philips has a stake designs and manufactures the photolithographic equipment used by most semiconductor manufacturers, including TSMC, Intel, Samsung and GlobalFoundries. Its role in the industry is very relevant, so Wennink’s prediction sounds more like a premonition than to a forecast.

There is also a waiting list to get the machines that make chips

According to Ignacio Mártil de la Plaza, Professor of Electronics at the Complutense University of Madrid and an accomplished expert in semiconductors and photovoltaic solar energy, “a state-of-the-art chip factory takes not less than four years to be fully operational. This is the period of time that elapses between the moment in which its construction begins and the moment in which it is ready to start the manufacture of integrated circuits.

However, for the project to be completed within this period, it is not only necessary for the works to prosper at a good pace; It is also essential that the photolithographic equipment involved in the production of the chips be ready to be used on time. The current demand for these machines is very high, and it is understandable that it is at a time when all chip manufacturers are striving to increase their production.

An industry in the hands of TSMC and Asian factories: the map of world chip production

TSMC, Intel, Samsung, GlobalFoundries, SMIC… These five companies monopolize more than 85% of global chip production, and all of them are building new factories in order to provide a robust response to the growing demand for semiconductors. Naturally, they all need the machines produced by ASML and other companies specializing in fine-tuning photolithographic equipment to equip their new factories.

TSMC, Intel, Samsung, GlobalFoundries and SMIC account for more than 85% of world chip production

In addition, many of them also need to renew some of the equipment in the factories that are already producing chips, which is causing the delivery times managed by the manufacturers of photolithography machines to increase dramatically. In fact, according to The Wall Street Journal, before the pandemic the delivery time for this equipment was a few months, and currently the waiting list required to get hold of some of these machines extends up to three years.

According to this newspaper, the manufacturers of photolithographic equipment are unable to respond to the demand because they too have difficulties in obtaining the components they need, especially the chips that incorporate these machines. In fact, some of them include several dozen integrated circuits, and most of them are high-integration chips, which are the most complex and expensive.

Given the circumstances, it is clear that the semiconductor industry is facing a structural problem from which it will not be easy to escape. In fact, this is the reason why the executives who lead the companies that manufacture chips maintain a conservative position that above all defends extreme prudence.

Pat Gelsinger has recently recognized that the demand and supply of integrated circuits will balance in 2024, a year later than originally planned. And meanwhile, users will probably continue to have difficulties accessing some electronic devices, such as graphics cards or video game consoles. What can we do. Let’s cross our fingers that in two years this problem really disappears.

Cover image: TSMC

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