Technology May 05

Washington intensifies pressure on Taiwan chipmakers

US Commerce secretary laments the lack of domestic semiconductor production as she sets target of 30% 'because that matches our demand' 

Washington intensifies pressure on Taiwan chipmakers
Taiwanese high-tech chip foundries are some of the world's biggest and most advanced, and Taiwan Semiconductor Manufacturing Company (TSMC) is the world's largest. File photo by Reuters.

(ATF) Washington is upping the pressure on Taiwan’s semiconductor manufacturers to allocate more output to US carmakers, Commerce Secretary Gina Raimondo said Tuesday.

The US is also looking for ways to spur domestic production of a range of industrial components as it aims to reduce its reliance on foreign suppliers, particularly those in China, Raimondo said.

Taiwanese high-tech chip foundries are some of the world's biggest and most advanced, and Taiwan Semiconductor Manufacturing Company (TSMC) is the world's largest.

The industry, a substantial export, is powering Taiwan’s economy through the global coronavirus crisis. “Booming demand for semiconductors is prompting us to raise our Taiwan growth forecast for this year from 4.5% to 5%,” Julian Evans-Pritchard, senior economist at Capital Economics, said.

This is well above the consensus of just 4.2%. 

PRODUCED IN ASIA

Officials from other countries also are urging Taiwan to help with the crunch for the vital chips, the vast majority of which are produced in Asia.

"We're working hard to see if we can get the Taiwanese and TSMC, which is a big company there, to prioritize the needs of our auto companies since there's so many American jobs on the line," Raimondo said. "Not a day goes by that we don't push on them."

The Commerce secretary lamented the lack of domestic chip production.

"Right now we make zero percent of leading edge chips in the US” she said. “That's a problem, we ought to be making 30% because that matches our demand. It is definitely the case that we have to re-shore much of our supply chain.”

Early last month TSMC announced plans to invest $100 billion over three years to ramp up production capacity. It did not say where it would make the investments but last year, the company said it planned to spend $12 billion on a foundry in Arizona, its second US manufacturing site.

With reporting by Agence France-Presse

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semiconductors TSMC Taiwan US chip shortage Gina Raimondo US Commerce Secretary