Core Insights - A recent incident involving a failed reverse engineering attempt of ASML's DUV lithography machine has sparked significant discussion in the domestic semiconductor industry, highlighting the challenges faced by China's lithography machine sector [1][12] - The complexity of high-end industrial equipment has shifted from mere part replication to a focus on "implicit knowledge" and "system synergy," making reverse engineering increasingly ineffective [2][4] Industry Challenges - The failure of the reverse engineering attempt illustrates the systemic barriers in high-precision industrial equipment, where even precise measurements cannot recreate the necessary stress balance due to design tolerances and assembly dynamics [3][4] - ASML's latest EUV systems contain around 100,000 components sourced from over 5,000 suppliers, indicating the high level of complexity and integration required in such systems [5][7] Dependency on ASML - Despite the restrictions imposed by the US and its allies on the sale of advanced lithography machines to China, ASML remains a crucial supplier, with China accounting for 41% of ASML's revenue last year [12][14] - The limitations on maintenance and parts replacement for existing DUV machines have begun to impact Chinese manufacturers, as evidenced by declining yield rates at major foundries like SMIC [14][15] Need for Innovation - The current state of China's lithography machine industry reveals a systemic deadlock, necessitating a focus on foundational scientific research and the establishment of a complete ecosystem to achieve breakthroughs [16][17] - Companies must prioritize overcoming core technological monopolies, particularly in light sources and optical systems, to reduce reliance on foreign suppliers [17][20] Caution Against Prototype Thinking - The industry must be wary of "prototype thinking," which emphasizes the creation of functional prototypes at the expense of mass production, stability, and cost control [21][22] - Genuine progress in the lithography machine sector requires collaborative innovation across the entire supply chain to avoid superficial achievements and enhance the manufacturing capabilities of China's semiconductor industry [21][22]