It’s no secret that the semiconductor shortage is affecting industries across the globe. The shortage hit the GPU market particularly hard, which resulted in wildly inflated prices across the board (although steady price erosion since the start of 2022 has been welcome news to gaming enthusiasts). Auto manufacturers have also faced dwindling chip inventories, which has forced some companies to leave thousands of vehicles sitting in lots, unable to be delivered to dealerships. However, ASML CEO Peter Wennink described on an earning’s call how some companies take desperate measures to get their hands on highly sought-after and mature microprocessors.
According to Wennink, several large industrial companies have resorted to ripping chips out of consumer washing machines for industrial use. Typical household washing machines can range from $400 to thousands of dollars each, so that is a relatively expensive way to obtain chips manufactured on a mature process node. However, it’s more likely that these companies are buying used machines or devices earmarked to head to a recycling center. Companies could get the washing machines at a significant discount and still grab the chips in this scenario.
“Technology-wise, market-wise, geography-wise, it’s so widespread that we have significantly underestimated, let’s say, the width of the demand,” said Wennink yesterday during ASML’s Q1 2022 earnings call. “And [I don’t] think it is going to go away.”
Wennink referenced a “very large industrial company, [conglomerate]” when talking about washing machine chip raiding. “Now, you could say, that’s an anecdote. But, to be honest, it happens everywhere,” Wennink continued. “It is — like I said, it is 15, 20, 25-year old semiconductor technology that is now being used everywhere. It’s got — it’s all driven by IoT type applications.”
ASML, which previously stood for Advanced Semiconductor Materials Lithography, is headquartered in Veldhoven, Netherlands. It is currently the world’s exclusive supplier of extreme ultraviolet lithography (EUV) photolithography machines. These machines produce advanced semiconductors from well-known industry titans like Intel, Samsung, SK Hynix and TSMC.
Earlier this year, the company made headlines when a fire inside its Berlin factory disrupted its production lines. Then, in February, ASML got into a verbal tussle with China’s Dongfang Jingyuan Electron Ltd. ASML accused the company of infringing on its intellectual property under the protection of the Chinese government’s “little giant” classification.