Commerce Dept. presses Taiwan to provide extra chips to U.S. automakers

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Secretary of Commerce Gina Raimondo testifies before the Senate Funds Committee during a hearing in the Dirksen Senate office building on Capitol Hill in Washington, DC on April 20, 2021.

Chip Somodevilla | Pool | Reuters

The US Department of Commerce is urging Taiwan Semiconductor Manufacturing Co and other Taiwanese firms to prioritize the needs of US automakers in order to reduce chip shortages in the short term, Commerce Secretary Gina Raimondo said Tuesday.

Raimondo told a Council of the Americas event that longer-term, increased investment would be needed to produce more semiconductors in the US and that other critical supply chains, including those in allied countries, would need to be re-funded.

“We’re working hard to get the Taiwanese and TSMC, who are a big company there, to prioritize the needs of our auto companies with so many American jobs at stake,” Raimondo said in response to a question from a General manager Engine.

“As I said, not a day goes by that we don’t do this,” she said, adding that the medium- and long-term solution would be to “just make more chips in America.”

TSMC said addressing the shortage remains a top priority.

“TSMC has worked with all parties to address the shortage of automotive chips. We understand this is a common concern of the global automotive industry,” it said in a statement to Reuters on Wednesday.

CC Wei CEO CC Wei said last month the company had been working with customers since January to reallocate more capacity to support the auto industry. However, the shortage worsened due to a snow storm in Texas and an interruption in factory production in Japan.

Wei expected the chip shortage for its auto customers to be greatly reduced by the next quarter.

The trade department is planning a high-level meeting with automakers next week on the issue of chip shortages, officials said. A spokesman for the Commerce Department declined to comment.

United Auto Workers Legislative Director Josh Nassar said in a written testimony for a US House hearing Wednesday that the shortage of chips has led to the layoff of “tens of thousands of workers.” Of course, we need to strengthen domestic automotive-grade semiconductor production. “

Last week, Ford Motor warned the chip shortage could cut production in half and cost it in the second quarter
about $ 2.5 billion and about 1.1 million production losses in 2021.

GM said Friday it would extend production stops at several North American factories because of the shortage.

On April 12, Biden gathered executives from the semiconductor and auto industries to discuss solutions to the chip crisis. He is donating $ 50 billion to aid U.S. chip manufacturing and research.

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