Market evolution: Semiconductor manufacturing equipment (CN 848620) — 2015–2025

Introduction

This report examines the trade dynamics of EU semiconductor manufacturing equipment (Combined Nomenclature code 848620 — "Machines and apparatus for the manufacture of semiconductor devices or of electronic integrated circuits") between January 2015 and December 2025. The period coincides with a profound transformation of the global semiconductor industry: the rise of the Internet of Things and artificial intelligence, successive supply-chain crises triggered by the COVID-19 pandemic and geopolitical tensions, and massive public and private investment programmes aimed at expanding chipmaking capacity worldwide.

The data reveal that the EU has dramatically strengthened its position as a net exporter of this strategic equipment, transforming a solid trade surplus into an exceptionally large one. While export volumes have remained roughly stable, their value has surged by over 300%, reflecting a sharp move upstream toward higher-value-added machinery. The analysis below is structured around three main findings: the price-driven explosion of EU exports, the geographic re-orientation of trade flows toward Asia, and the evolving structural characteristics of the market in terms of concentration, specialisation and strategic autonomy.

1. A value revolution: EU exports surge through price, not volume

EU export values quadrupled while volumes stagnated

The most striking feature of the 2015–2025 period is the divergence between the value and the physical volume of EU exports. In 2015, the EU exported approximately 13,877 tonnes of semiconductor manufacturing equipment worth €5.6 billion; by 2025, the volume had barely moved (13,546 tonnes, a marginal decline of 2.4%), yet the value had soared to €23.9 billion — an increase of 326%.

The unit export price thus rose from roughly €404,000 per tonne to nearly €1.77 million per tonne — a 337% increase. This indicates that the EU has moved decisively toward the most technologically sophisticated and capital-intensive segments of the equipment market — extreme ultraviolet (EUV) lithography systems, advanced deposition tools, and other high-specification machinery that commands premium prices.

Production data confirms a high-value, low-volume strategy

The EU production data corroborates this interpretation. The number of items produced fell by 67% (from 121,579 units in 2015 to 40,000 in 2025), while the reported production value surged by 1,401% — from approximately €2.0 billion to €30.0 billion. The average value per unit produced thus increased from roughly €16,400 to €750,000, a dramatic shift toward fewer, more complex and more expensive machines.

This pattern is consistent with the global trend in leading-edge chipmaking equipment, where each new technology node requires increasingly sophisticated (and costly) tools, particularly in lithography.

The trade surplus widened enormously on the back of price gains

The EU trade balance in semiconductor equipment expanded from €4.3 billion in 2015 to €22.3 billion in 2025 — a gain of 423%. This is almost entirely the result of the export-price effect: import values grew only modestly (from €1.3 billion to €1.6 billion, +19%), and import volumes actually fell by 45% (from 7,945 tonnes to 4,350 tonnes), while the import unit price more than doubled (from €170,000 to €369,000 per tonne, +118%).

The EU's net import reliance stood at −195% in 2025 (down from −280% in 2015), meaning the EU remained a very strong net exporter throughout the period, albeit somewhat less so relative to domestic production at the end than at the beginning — a reflection of the enormous increase in reported production value.

2. Geographic re-orientation: Asia becomes the dominant destination for EU equipment

China emerged as the single largest export market

The most dramatic geographic shift in EU exports has been the rise of China. In 2015, China accounted for €656 million of EU semiconductor equipment exports; by 2025, this figure had reached nearly €9.0 billion — a 1,267% increase and by far the largest absolute growth among all partners. China's share of EU exports rose from approximately 12% to roughly 37%, making it the EU's top destination by a wide margin.

This surge reflects China's massive investment in domestic semiconductor fabrication capacity, driven both by commercial demand and by policy imperatives to achieve self-sufficiency in chip production. Notably, however, the EU's export growth to China accelerated particularly from 2018 onwards, even as geopolitical tensions around semiconductor technology intensified — the data suggest a peak in Chinese demand for EU equipment in 2022 (€10.3 billion) before a partial pull-back to €9.0 billion in 2025, possibly reflecting the impact of export-control measures.

East Asian markets collectively absorbed the lion's share

Beyond China, the three other major East Asian semiconductor hubs — Taiwan, South Korea, and (to a lesser extent) Japan — all represented significant and growing markets for EU equipment. Taiwan grew from €1.4 billion to €5.3 billion (+274%), and South Korea from €1.5 billion to €5.0 billion (+238%). Together, China, Taiwan, and South Korea accounted for approximately 81% of the EU's 2025 equipment exports, up from roughly 65% in 2015.

This concentration reflects the global geography of semiconductor fabrication, which is heavily concentrated in East Asia. The EU's export profile is therefore structurally shaped by capital-expenditure cycles at the leading Asian foundries and memory producers.

On the import side, Japan and the United States remained the primary suppliers

EU imports of semiconductor manufacturing equipment remained dominated by Japan and the United States, although their trajectories diverged. Japanese imports fell from €686 million to €398 million (−42%), while US imports rose from €470 million to €578 million (+23%). Among the smaller suppliers, imports from Taiwan and South Korea grew rapidly (by 1,528% and 546% respectively), though they remained modest in absolute terms. This shift may partly reflect the growing presence of Asian equipment makers in niche segments.

The Netherlands consolidated its dominance of EU exports

Within the EU, the Netherlands overwhelmingly dominates semiconductor equipment exports, reflecting the headquarters location of ASML, the world's leading lithography manufacturer. Dutch exports grew from €4.5 billion to €20.9 billion (+367%), accounting for approximately 87% of all EU exports in 2025. Austria showed the next-largest growth (+443%, from €307 million to €1.7 billion), while Germany posted more moderate growth of 60% (from €589 million to €941 million).

On the import side, Ireland was the largest EU importer in 2015 (€841 million) but saw a 68% decline to €274 million by 2025, reflecting its dependence on foreign equipment for its large semiconductor fabrication plants (notably Intel). Germany and France, by contrast, saw significant increases in imports (+117% and +409% respectively), suggesting growing domestic investment in chipmaking capacity — likely linked to the EU Chips Act initiatives.

3. Market structure, volatility and strategic implications

The import market became more diversified while the export market concentrated

The Herfindahl-Hirschman Index (HHI) for import partners fell from 3,856 to 2,163 (−44%), indicating that the EU's sources of supply became significantly less concentrated. The declining role of Japan and the emergence of multiple Asian suppliers contributed to this diversification. By contrast, the HHI for export partners rose from 2,000 to 2,522 (+26%), reflecting the growing dominance of China as a destination and increasing export concentration.

This dual trend carries strategic implications: while the EU has diversified its import sources (reducing supply-side risk), it has simultaneously become more dependent on a small number of Asian markets for its exports — creating potential demand-side vulnerability.

Austria and Ireland show the highest specialisation in this product category

Among EU member states, Austria (RSCA 0.46), Ireland (RSCA 0.44), and France (RSCA 0.43) show the highest revealed comparative advantage in semiconductor manufacturing equipment in 2025. Germany, despite being the largest absolute exporter after the Netherlands, has a lower specialisation index (RSCA 0.29) due to its highly diversified industrial base. Conversely, several member states — including Poland, Luxembourg, Portugal, and Greece — show essentially no specialisation in this product, with RCA values at or near zero.

Export volatility was moderate for major partners, but price shocks occurred

The coefficient of variation for EU exports to the main partners was generally moderate (ranging from 0.32 for China to 0.67 for Taiwan), suggesting relatively stable trade flows despite the large value swings. Two notable price shocks were detected:

• South Korea, 2020: A price shock with an abnormality score of 13.9 and a shift of +176%, coinciding with the global COVID-19 pandemic and the beginning of the semiconductor supply crunch.
• United States, 2017: A price shock with an abnormality score of 10.3 and a shift of +114%, possibly linked to the early stages of the US-China technology decoupling and related capital expenditure shifts.

On the import side, volatility was generally higher for smaller suppliers (e.g., the Philippines at a CV of 2.3, Taiwan at 1.2), while more established trade relationships showed lower variance (United Kingdom at 0.33, Switzerland at 0.35).

Trade intensity and export propensity declined from peak levels

The EU's trade intensity (the ratio of trade to domestic production) fell from 145% in 2015 to 77% in 2025 (−47%), while export propensity dropped from 156% to 75% (−52%). These declines do not indicate weakening competitiveness; rather, they reflect the massive increase in the reported production value (from €2.0 billion to €30.0 billion), which mechanically reduces trade-to-production ratios. In absolute terms, exports continued to grow strongly, but domestic production value grew even faster — a potentially positive signal for the EU's strategic autonomy in this critical technology sector.

Conclusion

Over the decade 2015–2025, the EU's trade in semiconductor manufacturing equipment underwent a profound transformation. The bloc consolidated its position as the world's leading exporter of this strategic capital good, with trade surpluses expanding from €4.3 billion to €22.3 billion. This growth was overwhelmingly driven by rising unit prices rather than higher physical volumes, reflecting a decisive shift toward the most advanced and expensive equipment segments — most notably EUV lithography systems.

Geographically, Asian markets — and China in particular — became the dominant destination for EU equipment, absorbing over 80% of exports by 2025. This concentration creates both opportunity and vulnerability: while demand from Asian chipmakers has been the engine of EU export growth, it also exposes the bloc to the risk of policy-driven demand shocks, including the tightening of export controls.

Structurally, the market shows encouraging signs: import sources have diversified (HHI declining 44%), EU member-state specialisation is high in key economies, and the dramatic growth in reported production value suggests that more of the value chain is being captured domestically. However, the dominance of a single EU member state (the Netherlands) in exports, combined with growing export concentration toward China, represents a significant geopolitical exposure that policymakers and industry leaders will need to monitor carefully as semiconductor technology continues to sit at the intersection of industrial policy and international security.