The Taiwan Ministry of Economy told Reuters that Taiwan Semiconductor Manufacturing Co (TSMC) will prioritize automotive chip manufacturing. This topic was discussed yesterday by the minister and the company’s management.
Although the largest contract chip manufacturer is fully utilized, there is a chance to improve performance through optimization. TSMC management promised the government that if it succeeds, the priority will be given to products for the automotive industry.
Germany recently asked Taiwan to convince local manufacturers to help address the chip shortage in the automotive sector, which is hampering its economic recovery from the COVID-19 pandemic. The ministry said similar requests have already been received through “diplomatic channels” from other European Union, as well as from the United States and Japan.
Automakers around the world are closing assembly lines due to semiconductor supply issues. The shortage affected Volkswagen, Ford Motor, Subaru, Toyota Motor, Nissan Motor, Fiat Chrysler Automobiles and other car manufacturers. Having reduced orders for chips when demand for machines was low amid the pandemic, they are now unable to ramp up production. The situation was exacerbated by the actions of the Trump administration against key Chinese chip manufacturers.
Note that in 2020, automotive chips made up only 3% of TSMC’s sales, while, say, smartphones’ chips – 48%.
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