US pressing Taiwanese firms on semiconductors

Washington looking for ways to spur domestic production

WASHINGTON (AFP) — The United States is pressuring Taiwanese semiconductor manufacturers to allocate some of their supply to American automakers grappling with a shortage of the crucial components, U.S. Commerce Secretary Gina Raimondo said Tuesday.

Washington also is 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 during an appearance at an Americas Society event.

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.

“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,” she said.

“Not a day goes by that we don’t push on them.”

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.

Detroit automakers have cut production and warned of hits to output due to the shortage, with Ford last week saying it will cut its second-quarter production by half.

The supply crunch also has raised worries throughout the personal electronics universe, generating potentially higher prices for popular gadgets like game consoles and computer tablets.

“Right now we make zero percent of leading edge chips in the United States.

That’s a problem, we ought to be making 30 percent because that matches our demand,” Raimondo said.

“It is definitely the case that we have to reshore much of our supply chain,” she added.

President Joe Biden in February issued an executive order calling for a 100-day review across federal agencies of semiconductors and three other key items: pharmaceuticals, critical minerals and large capacity batteries.

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 U.S. manufacturing site.

Company chair Mark Liu, who met with Biden last month, told the CBS program 60 minutes on Sunday that TSMC hopes to catch up on “minimum” requirements of automakers by June. But he warned there would be a lag for auto chips that have a “long and complex” supply chain.

TSMC eyes expansion of planned Arizona plant

TAIPEI (Reuters) — Taiwan Semiconductor Manufacturing (TSMC) is planning to build several more chipmaking factories in the U.S. state of Arizona beyond the one currently planned, three people familiar with the matter told Reuters.

TSMC, the world’s largest contract chipmaker, announced in May 2020 it would build a $12 billion factory in Arizona, an apparent win by the Trump administration in its push to wrestle global tech supply chains back from China.

TSMC is setting up a 12-inch wafer fabrication plant in Phoenix, and the facility is expected to start volume production in 2024, Taiwan’s investment commission of the ministry of economic affairs, which approved the investment, said in December.

TSMC manufactures the bulk of its chips in Taiwan and has older chip facilities in China and the U.S. state of Washington.

Three sources familiar with the matter, speaking on condition of anonymity as they were not authorised to speak to the media, told Reuters that up to five additional fabs for Arizona are being planned.

The initial fab is relatively modest by industry standards, with a planned output of 20,000 wafers — each of which contains thousands of chips — every month using the company’s most sophisticated 5 nanometer semiconductor manufacturing technology.