TAIPEI (Reuters) – Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) will prioritize the production of automated chips if it can increase capacity, Taiwan’s Ministry of Economy told Reuters amid a global shortage hampering car production .
According to a ministry official, Minister Wang Mei-hua spoke to senior management members about the matter on Sunday.
TSMC told the ministry it would “optimize” the chip production process to make it more efficient and prioritize the production of automatic chips if it could increase capacity, the ministry said.
TSMC, the world’s largest contracting chip maker, said the current production capacity was full, but assured the ministry that ‘if production can be increased by optimizing production capacity, it will work with the government to make motor chips as’ consider a primary application ‘.
TSMC, in a statement to Reuters, referred to comments from its CEO, CC Wei, on a earnings call this month.
“Apart from the continued maximum utilization of our existing capacity, Dr. Wei also confirmed at our investor summit that we are working closely with clients and moving from their mature nodes to more advanced nodes, where we have a better ability to support them,” said the company.
Germany has asked Taiwan to persuade Taiwanese manufacturers to ease a shortage of semiconductor chips in the automotive sector, hampering the new economic recovery from the COVID-19 pandemic.
The request was made to Wang in a letter from German Economy Minister Peter Altmaier.
The ministry said it would wait until it received the letter before deciding whether to contact TSMC again. Car manufacturers around the world are closing assembly lines due to problems in the delivery of semiconductors, which in some cases have been exacerbated by the former Trump administration’s action against major Chinese chip factories.
MANY CARMAKERS ATTRACTED
The shortfall affected Volkswagen, Ford Motor Co., Subaru Corp, Toyota Motor Corp, Nissan Motor Co. Ltd, Fiat Chrysler Automobiles and other car manufacturers.
The ministry told Reuters that late last year it had received requests from both the United States and the European Union via “diplomatic channels” as well as Germany and Japan.
Motor companies are said to have reduced orders to TSMC in the second quarter of last year, which in turn transferred capacity to other customers, but in the second half of the year, demand for car chips returned.
“The Americans expressed the expectation late last year,” the ministry said.
‘At the moment, everyone is talking to each other through diplomatic channels, including TSMC. Everyone’s hands are tied with commands, but from the government’s perspective we will try to help as much as possible for our important allies. ”
A European Commission spokesman said there were “no specific discussions” with Taiwan, but that they were closely monitoring the shortage of car signs.
A senior official of the Japanese Ministry of Economy, Trade and Industry told Reuters the association of car manufacturers and the TSMC were already in touch, and the ministry also reached out to the Japanese embassy in Taipei in Taipei for their support in the talks. to ask.
The official added that it is primarily an exchange in the private sector, so the government is limited in what it can do.
In 2020, automated chips accounted for only 3% of TSMC’s sales, with 48% of smartphones and 33% of high-performance chips.
In the fourth quarter, sales for TSMC’s automatic chips increased by 27% compared to the previous quarter, but it was still only 3% of total sales in the quarter.
A senior Taiwanese government official familiar with the matter told Reuters there was not much they could do.
‘They dropped their orders for various reasons when demand was low amid the pandemic. But now they want to increase their production. ”
Reporting by Jeanny Kao and Yimou Lee; Additional reporting by Kaori Kaneko in Tokyo and Foo Yun Chee in Brussels; Writing by Ben Blanchard; Edited by Christian Schmollinger, Shri Navaratnam and Raju Gopalakrishnan