ASML Keeps Part of Berlin Manufacturing Site Shut After Fire

(Bloomberg) -- ASML Holding NV shut a part of its German manufacturing site after a fire earlier this week, causing concern the closing could exacerbate a global chip shortage.

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The fire impacted approximately 200 square meters out of a total 32,000 square meter Berlin-based site, according to the local fire brigade. Only the affected area remains closed and other areas of the manufacturing site are still operating, an ASML spokesperson told Bloomberg on Tuesday.

The Berlin site makes various parts that go into ASML equipment, including the wafer clamp and mirror block in advanced extreme ultraviolet lithography machines.

The company has a de-facto monopoly producing the advanced machines, supplying key companies like Taiwan Semiconductor Manufacturing Co. and Samsung to produce cutting-edge chips. ASML also competes with Japan’s Nikon Corp.

“If ASML’s shipments are cut by 10% due to a fire at its Berlin factory, where key parts for its semiconductor lithography machines are made, that could temporarily reduce global supply of lithography tools by around 8.4%, as ASML has 84% market share in the tools,” Masahiro Wakasugi, an analyst at Bloomberg Intelligence, wrote Tuesday.

ASML did not say how long the area of its Berlin site would be closed or if they have enough alternate suppliers to make the relevant parts. The company said that it would take a few days to conduct a “thorough investigation and make a full assessment” on the impact of the site’s closing.

ASML reversed gains after the Bloomberg report and was trading 0.6% lower as of 3:53 p.m. local time after dropping as much 0.8%. The shares closed down 0.7% on Monday.

(Updates with stock reaction)

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