China Reproduced ASML Technology and Is Moving Toward Domestic Production of Advanced Chips

Chinese scientists have created a prototype machine capable of producing advanced semiconductor chips. They are the basis of artificial intelligence, smartphones, and weapons, and have been key to the West’s military advantage for years.

Reuters reported on this, citing its sources.

The prototype was completed in early 2025 and is currently being tested. The machine takes almost the entire area of one production workshop. According to two people familiar with the project, it was created by a team of former engineers from Dutch semiconductor giant ASML, who reverse-engineered the company’s extreme ultraviolet (EUV) lithography machines to recreate its technology.

Most likely, Huawei coordinates part of this network. The secrecy at the facility is at an all-time high, with engineers often sleeping on the job and working with limited access to their phones. ASML specialists were paid bonuses ranging from $420 to $700 thousand, issued fake IDs, and forced to work under false names.

The Chinese used reverse engineering: the prototype was built by disassembling old ASML machines purchased on the secondary market through intermediaries. Reuters sources also mention Nikon and Canon parts.

EUV machines are at the center of the “technological cold war.” They use beams of extreme ultraviolet light to deposit circuits thousands of times thinner than a human hair onto silicon wafers. The smaller the circuits, the more powerful the chips.

The Chinese machine is already up and running and successfully generating extreme ultraviolet light, but it is not yet producing usable chips, the sources said.

Years to develop the technology

In April, ASML CEO Christophe Fouquet voiced that it would take “a very, very long time” for China to develop such a technology. However, the existence of the prototype suggests that China may be years closer to semiconductor independence than analysts expected.

Despite this, China still faces serious technical difficulties, in particular in reproducing the high-precision optics produced by Western suppliers.

The availability of parts from older ASML machines on the secondary market allowed China to create a domestic prototype. According to two sources, the government has set a goal of starting production of working chips on this prototype by 2028. The project participants believe that 2030 is more realistic, which is still several years earlier than analysts had expected when estimating the time it would take China to catch up with the West in chip technology.

This breakthrough is the culmination of a six-year government initiative to achieve semiconductor self-sufficiency, one of President Xi Jinping’s top priorities. While China’s goals in this area have been public, the EUV project in Shenzhen was implemented in secret, sources said.

The project is part of the national semiconductor strategy, which, according to state media, is overseen by Xi Jinping’s confidant Ding Xuesiang, chairman of the Communist Party’s Central Commission for Science and Technology.

Reuters sources compared the project to a Chinese version of the Manhattan Project, the American military program to create an atomic bomb.

“The goal is that China will eventually be able to produce advanced chips on machines made entirely in China,” one of the sources shared. “China wants to cut the United States out of its supply chain by 100 percent.”

So far, only one company has mastered EUV technology – ASML, headquartered in Veldhoven, the Netherlands. Its machines, worth about $250 million, are indispensable for the production of state-of-the-art chips developed by companies such as Nvidia and AMD and manufactured by TSMC, Intel, and Samsung.

ASML’s EUV systems are currently available to US allies, including Taiwan, South Korea, and Japan.