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Home Cars

Auto chips to get priority from top global producer

January 25, 2021
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The shortage has affected Volkswagen, Ford, Subaru, Toyota, Nissan, Stellantis and other automakers.

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

It said that in the second quarter of last year auto companies cut orders to TSMC, which in turn shifted capacity to other clients, but in the second half of the year demand for auto chips returned.

“The Americans did express 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 orders, but from the government’s perspective we will try to help as much as we can for our important allies.”

A senior official at Japan’s Ministry of Economy, Trade and Industry told Reuters Japan’s auto manufacturers’ association and TSMC were already in touch, and the ministry has also reached out to Japan’s de facto embassy in Taipei to ask for their support in those talks.

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

In 2020, auto chips accounted only for 3 percent of TSMC’s sales, lagging smartphones’ 48 percent and 33 percent for high performance chips.

In the fourth quarter, sales for TSMC’s auto chips jumped 27 percent from the previous quarter, but still only accounted for 3 percent of overall sales in the quarter.

A senior Taiwan government official familiar with the issue told Reuters there is not much they could do.

“They dropped their orders due to various reasons when demand was low amid the pandemic. But now they want to boost their production.”

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