Taiwan’s leading trade official called the global shortage of automatic chips an opportunity for Taipei to build closer ties with Western countries.
“Everyone sees this situation and thinks they can no longer ignore Taiwan,” Taiwan Trade Representative John Deng told the Financial Times. “It is definitely beneficial for Taiwan’s trade agenda.”
The remarks follow weeks of lobbying by various governments at Taiwan, a hub for global semiconductor manufacturing, to allocate more capacity to car chips.
In January, German Economy Minister Peter Altmaier asked his Taiwanese counterpart Wang Mei-hua to ensure that Taiwan Semiconductor Manufacturing Company, the world’s largest contract maker, would prioritize chips for use in cars. Tokyo and Washington were also in direct contact with the Taiwanese government and TSMC over the shortfall.
After an online meeting with U.S. government officials and management members of the company about collaboration in the supply chain on Friday, Wang said the Americans thanked Taiwan for helping with the auto kit issue.
The intense government involvement has caused political controversy in Taiwan. One local newspaper in a major article on Thursday voiced criticism of what it calls Wang’s intervention in private business.
The setback was intense, especially as Germany has traditionally avoided any recognition of Taiwan’s existence or close ties for fear of offending China. Beijing claims Taiwan as its territory and demands that other countries deny the recognition of its de facto independence.
After Taiwan donated millions of medical face masks to European countries last year, German Chancellor Angela Merkel’s spokeswoman would not even utter the word “Taiwan” at the request of journalists for recognition.
“In the past, some countries may have thought it was a problem if they got too close to Taiwan, and that China would punish them,” Deng said.
The shortage of cars underscored the importance of Taiwan and its crucial role in the semiconductor industry, he added. “This issue has shown the whole world that Taiwan is trustworthy and that Taiwanese companies can be trusted.”
In the US, the shortage of cars no longer led to discussions about the need to bring back more semiconductor manufacturing capacity, which moved to Asia years ago.
General Motors will close three US plants this week and reduce production at a South Korean plant due to the shortage. Ford reduced production at two plants this week and said last week that the shortage of chips could reduce profits this year by $ 2.5 billion.
Deng underestimated the prospects for any quick fix to the shortage. “It’s not going to happen,” he said, commenting on proposals to build more chip production capacity in the US to ease pressure.
He said recent talks between governments have not had a direct impact on the allocation of capacity.
While TSMC accounts for more than half of the world’s foundry market, car chips make up only 3 to 4 percent of its revenue. In addition, car manufacturers do not buy chips directly from them, but from car suppliers. They in turn get it from dedicated chip design companies that outsource production to TSMC.
“It’s natural for every country’s government to support their industry,” Deng said. ‘But it’s a commercial decision. After all, business is business. ”