Export restrictions prompt KMWE to open Chinese subsidiary

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Semicon supplier KMWE has opened a plant in China to circumvent semiconductor technology export restrictions. The new branch manufactures the same products as an existing location in Malaysia, but exclusively for the Chinese market. “Without the trade conflict between the US and China, we probably wouldn’t have done that,” says KMWE director Edward Voncken in Eindhovens Dagblad.

KMWE’s headquarters are and will remain at the Brainport Industries Campus in Eindhoven. Credit: Studio 38C/Remco Lassche via KMWE

The United States announced several restrictions on the export of semiconductor-related technology last October. These also affect suppliers of semiconductor equipment manufacturers – KMWE works for ASML and Besi, among others. Moreover, Chinese companies and also the Chinese government increasingly demand that (components for) electronics and semiconductor manufacturing equipment are sourced from China-based suppliers. This is to prevent more nasty surprises and to boost the domestic semiconductor industry.

Fellow Brainport equipment manufacturer NTS has had a subsidiary in China for some time. Recently, its director explained how the months-long lockdown in Shanghai has seriously damaged confidence in the Chinese government. A large number of European companies have left as a result, according to the European Chamber of Commerce.