U.S. Commerce Secretary Gina Raimondo said the government is negotiating with Taiwan and TSMC to give Taiwan priority in providing much-needed chips to U.S. auto makers. Several U.S. auto manufacturing companies said several factories had to shut down and tens of thousands of workers were laid off due to chip shortages.
U.S. Commerce Secretary Raimondo speaks at a press conference at the White House (Reuters, April 7, 2021)
Speaking at a conference hosted by the business community on Tuesday (May 4, 2021), Secretary Raimondo said, “We are making an effort to see if we can urge the Taiwanese and the big company TSMC to prioritize the needs of our auto companies as it relates to the jobs of many Americans. As I’ve said, we’re working every day to make this happen.”
The Biden administration has been pushing Taiwan to do this since February of this year, but U.S. automakers say the supply of chips has not increased.
The shortage of automotive chips that began last December still plagues the U.S. and global auto manufacturing industry. Some analysts believe that the reason for the shortage of automotive chips, one because of the rebound in demand for cars after the new coronavirus epidemic is underestimated; the second is because chip makers give priority to higher volume and more lucrative consumer electronics like smartphones.
As the world’s largest chip producer, TSMC had issued a statement in late January promising to reallocate production capacity to support the global automotive industry.
FILE PHOTO: Taiwan semiconductor giant TSMC Chairman Deyin Liu in an interview. (Aug. 31, 2018)
TSMC Chairman Deyin Liu said last Sunday (May 2) that he expects to be able to meet customers’ minimum demand for automotive chips by the end of June, but that does not mean the shortage will end when the shortage of automotive chips ends in two months.
Commerce Secretary Raimondo said that in the long run, the United States must improve chip production capacity and urged Congress to allocate funds to support the effort.
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