Taiwan ministry says TSMC will prioritize auto chips if possible

A CPU socket and a close image of the motherboard lie on the table.

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Taiwan Semiconductor Manufacturing Co. (TSMC) will prioritize the production of auto chips if it is able to increase capacity, Taiwan’s Ministry of Economics, Minister Wang Mei-hua, spoke to senior company officials on Monday.

A ministry official said Minister Wang Mei-hua spoke to senior officials of the company on the issue on Sunday.

The ministry said that TSMC had told the ministry that it would be “optimized” to make the production process of the chips more efficient and to prioritize the production of auto chips if it is able to increase capacity further, the ministry said.

TSMC, the world’s largest contract chipmaker, said current production capacity is full, but had assured the ministry that “if production can be increased by optimizing production capacity, it will make automotive chips a primary application.” Will cooperate with the government as it considers. “

TSMC in a statement to Reuters referred to its chief executive officer CC Wei’s comments on this month’s earnings.

“In addition to increasing the continued use of our existing capacity, Dr. V also confirmed at our investors’ conference that we are working closely with customers and moving their mature nodes to more advanced nodes, where We have a better ability to support them. ” The company said.

Germany has asked Taiwan to persuade Taiwanese manufacturers to help reduce the shortage of semiconductor chips in the auto sector, which is hampering its runaway economic recovery from the Kovid-19 epidemic.

The request was made in a letter from German Economy Minister Peter Altmaier to Wang.

The ministry said it would wait until it received the letter before deciding whether to contact TSMC again.

Vehicle manufacturers around the world are closing assembly lines due to problems in the distribution of semiconductors, which in some cases have been exacerbated by prior actions of the Trump administration against major Chinese chip factories.

Many carmakers were impressed

The shortage has affected Volkswagen, Ford Motor, Subaru, Toyota Motor, Nissan Motor, Fiat Chrysler Automobile and other car manufacturers.

The ministry told Reuters that it received requests from both the United States and the European Union through “diplomatic channels” late last year, as well as from Germany and Japan this year.

It added that auto companies cut TSMC orders in the second quarter of last year, which led to a shift in capacity from other customers, but demand for auto chips returned in the second half of the year.

“The Americans expressed hope 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 to orders, but from the government’s point of view we will try to help as much as we can for our important allies. “

A senior official in Japan’s Ministry of Economy, Trade and Industry told Reuters that Japan’s auto manufacturers’ union and TSMC were already in contact, and the ministry reached Japan’s de facto embassy in Taipei to seek their support in those matters Has also reached.

The official said that this is mainly a private sector exchange so the government is limited in what it can do.

In 2020, only 3% of auto chips accounted for TSMC sales, with 48% for smartphones and 33% for high-performance chips.

In the fourth quarter, TSMC’s auto chips sales grew 27% from the previous quarter, but still accounted for only 3% of total sales in the quarter.

A senior Taiwan government official familiar with the issue told Reuters that they could not do so.

“They dropped their orders due to various reasons as the epidemic reduced demand. But now they want to boost their production.”


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