Samsung Cuts Back on EUV Plans, Leaving Joint Research Center with ASML in Limbo

Daniel Nenni · Aug 21, 2024

During his state visit to the Netherlands, President Yoon Suk-yeol is seen donning protective gear before touring the 'cleanroom' at ASML's headquarters in Veldhoven on December 12, 2023 (local time). He was accompanied by King Willem-Alexander of the Netherlands, Samsung Electronics Chairman Lee Jae-yong, SK Group Chairman Chey Tae-won, and ASML CEO Peter Wennink. (Photo provided by the Presidential Office)

On December 12, 2023 (local time), President Yoon visited ASML's headquarters in Veldhoven, Netherlands, accompanied by King Willem-Alexander, Samsung Electronics Chairman Lee Jae-yong, SK Group Chairman Chey Tae-won, and ASML CEO Peter Wennink. During this visit, President Yoon expressed his hope to strengthen the semiconductor alliance between Korea and the Netherlands, stating, "I thought that openness and internationalism are what foster science and industry."

In that place, Samsung Electronics and ASML signed a Memorandum of Understanding (MOU) to establish an EUV joint research center in the metropolitan area. This agreement was part of the Korea-Netherlands semiconductor cooperation ceremony held at ASML's headquarters, coinciding with President Yoon Suk-yeol's state visit to the Netherlands. However, just six months later, the collaboration plan has been significantly scaled back.

In January this year, during a public forum on the semiconductor industry, President Yoon reiterated his support for international joint research, reflecting on his visit to ASML's headquarters. However, early last month, Samsung Electronics informed ASML that it would reduce the number of next-generation High NA EUV lithography equipment it plans to introduce. This decision was conveyed during a meeting between the top executives of both companies, and they are expected to soon begin the process of amending the related contract.

Samsung Electronics initially planned to purchase more than three units of the next versions, EXE:5200, EXE:5400, and EXE:5600, over the next ten years. However, the company has now decided to introduce only the EXE:5200 and will reconsider the introduction of subsequent versions in the future. This decision came after Vice Chairman Jun Young-hyun was appointed as the new head of the DS (Device Solutions) division and reviewed ongoing projects and investments.

An industry insider familiar with the situation said, "The process of purchasing land in Hwaseong, Gyeonggi Province, for the construction of the research facility, as well as the design and approval process, was underway. However, with Samsung's decision to reduce equipment introduction, the related process has been completely halted." The insider added, "Whether the joint research center will be established in another location or if the establishment itself will be canceled will be decided in future discussions."

Kyung Kye-hyun, who was the head of the DS division at the time and is now the head of the Future Business Planning Team and SAIT (Samsung Advanced Institute of Technology), emphasized the importance of establishing a cooperative relationship through joint research for High NA EUV. He stated, "Samsung now has a technical priority for 'High NA EUV'," and added, "I think we have created an opportunity to use High NA EUV well in DRAM or logic semiconductors in the long term."

Despite the revised plans, a Samsung Electronics official stated, "There is no change in the plan to introduce ASML High NA EUV equipment," and assured that "The R&D center of the two companies will also be established in the optimal location."

The collaboration between Samsung Electronics and ASML was initially seen as a strategic move to secure advanced EUV lithography equipment, essential for the mass production of advanced semiconductors. ASML is the only company in the world that produces EUV lithography equipment, making it a critical player in the semiconductor industry. The scaling back of this collaboration is expected to impact the domestic semiconductor ecosystem and related industries.

An industry insider mentioned, "If the contract signed by the two companies is followed, Samsung Electronics would not only be able to introduce the most advanced EUV equipment ahead of its competitors but also have the opportunity to closely observe the development process of the most advanced EUV technology. If the plan is revised, such possibilities will be lost."

The decision to reduce equipment introduction and halt the R&D center construction reflects a significant shift in Samsung's semiconductor business strategy following the appointment of Vice Chairman Jun Young-hyun. This move is expected to have broader implications for the global semiconductor supply chain and the competitive dynamics within the industry.