Four major chip production equipment makers have stopped selling new tools and providing support services for installed tools to China’s Yangtze Memory Technologies Co. (YMTC) due to new export rules that came into effect. effective Wednesday. To sell new equipment to YMTC and support existing machines, tool manufacturers must obtain a technology export license from the Bureau of Industry and Security (BIS) of the Ministry of Commerce.
US-based Applied Materials, KLA and Lam Research have ceased supplying equipment to produce 3D NAND memory with 128 or more layers to YMTC under the latest export rules (opens in a new tab) which impose new licensing requirements for semiconductor production equipment destined for China from October 12. However, they will continue to provide new equipment and tools to multinationals that produce chips in China – Samsung and SK Hynix – for one year without a license. Still, all export license applications to supply tools to the Tsinghua Unigroup-controlled YMTC must be reviewed with a deemed refusal. Tsinghua Unigroup is a government-controlled organization.
For the same reason, ASML, which is in the Netherlands, told its US employees to stop “serving, shipping, or providing support to any customers in China until further notice,” according to a report. Bloomberg (opens in a new tab) report.
While Applied, KLA, and Lam Research ship die metrology, etching, deposition, inspection, and sorting tools to Yangtze Memory, ASML sells critically important lithography scanners to Chinese 3D NAND manufacturer. While formally the lithography tools used by YMTC are not as advanced as the tools used by producers of logic or dynamic random-access memories (DRAMs) and should theoretically not fall under the new licensing requirements, ASML prefers evaluate the new export rules and ensure that they comply with the new regulations.
YMTC has attempted to source all possible equipment and spare parts from its US partners in China over the past few weeks and days to continue producing 3D NAND without interruption to meet customer demands, which would include Apple. While he could probably acquire manufacturing equipment and spare parts (but no one), his main challenge now is installing and deploying new tools and parts. The new export restrictions imposed by the US government also include services. As a result, employees of ASML, Applied Materials, KLA and Lam Research cannot help YMTC, as well as other Chinese chipmakers, which means they cannot install new tools or replace faulty components. .
It is unclear whether YMTC engineers at its plant are qualified to service equipment produced by companies in the United States and the Netherlands. However, for now, YMTC’s 3D NAND bit supply is secure, according to DigiTimes (opens in a new tab).
Meanwhile, if YMTC employees cannot deploy new tools and repair production tools, sooner or later YMTC will have to reduce or even stop 3D NAND memory production. This is unlikely to happen as the business will struggle to survive. Yet, without the support of toolmakers, it will become much more difficult to maintain YMTC’s production facilities.
It should be noted that YMTC was preparing to accelerate its family of next-generation 3D six-plane NAND chips with the company’s Xtacking 3.0 architecture with approximately 200 layers and an interface speed of 2400 MT/s. These chips could eventually enable some of the best SSDs, but we don’t know if YMTC will be able to get the right tools to produce such memory devices.