White House Presses Taiwan On Semiconductor Shortage

Matt Posky
by Matt Posky
white house presses taiwan on semiconductor shortage

Automakers around the globe have been issuing warnings for weeks that the semiconductor shortage will eventually result in fewer cars and leaner profitability reports. But the absent chips are affecting just about every industry producing modern connected devices, creating fears that electronic prices could skyrocket as availability dwindles. Lockdowns effectively crippled semiconductor supply lines right as demand peaked and everyone is starting to get a little worried about how it’s going to impact production in other industries.

The White House is reportedly taking steps to mitigate the issue by tasking Brian Deese (Director of the National Economic Council) and Jake Sullivan (National Security Adviser) with coming up with a solution. It’s also asking embassies to assist chip suppliers around the world however possible and hopefully suss out a way to stop the global shortage. Meanwhile, Deese and Sullivan will be focusing the brunt of their efforts on Taiwan.

Having already discussed the issue with American automakers, the White House’s next phase looks to involve gently pressuring Asian chip suppliers to prioritize U.S. businesses. Semiconductors are overwhelmingly manufactured by companies based in China, Japan, Singapore, South Korea, and of course Taiwan.

According to Bloomberg, Deese issued a letter to Taiwan’s Minister of Economic Affairs, Wang Mei-hua, to request cooperation in dealing with supply chain issues. However, Wang told reporters on Thursday that she hadn’t received any such letter — noting that she was still busy dealing with the global chip shortage.

But there are factors making this whole issue a lot harder than its needs to be for both parties. China has continued to escalate military and diplomatic pressure against the democratic island nation and demand for semiconductors isn’t going to go down unless the whole world opts to use fewer electronic devices moving forward. Neither matter has an obvious solution and both seem like they’re poised to come to a head within the next few years.

From Bloomberg:

Taiwan is home to the largest semiconductor manufacturing industry in the world, and also relies on U.S. weapons to defend against China, which views the island as part of its territory and has threatened to use force if Taipei moves toward formal independence.

The Biden administration has also asked U.S. embassies around the world to identify how foreign countries and companies that produce chips can help address the global shortage and to map the steps taken to date, the spokesperson said.

Expect tough times for the automotive industry regardless of how well the plan works, however. Automakers have known about the chip shortage since December 2020 while the U.S. government was distracted with infighting and still hamstrung by pandemic restrictions. Most car builders have since suggested major declines in output for the first part of 2021. This week, IHS Markit likewise estimated almost 1 million fewer passenger vehicles will be produced in the first quarter and just keeps rising.

[Image: Orhan Cam/Shutterstock]

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  • Jkross22 Jkross22 on Feb 19, 2021

    Another reason to keep using what we have instead of buying a new, shiny object because reasons. Let's maintain what we already have before we go out and buy garbage we don't need. Reduced consumption is a good thing, and I'm not even talking about the materials cost or environment. Pretty sure happiness isn't found on the latest phone screen or insipidly large infotainment touchscreen. We should stop looking for it there. Oh yeah, and right to repair legislation would help this effort, too.

    • See 2 previous
    • Old_WRX Old_WRX on Feb 19, 2021

      Luke42, "reduce, REUSE, recycle" I'm not quite sure what you are getting at. Are you trying to say "reuse" covers build to last, repair, rebuild?

  • Akear Akear on Feb 19, 2021

    Due to prolonged outsourcing and lack of investment in technology, America is becoming more reliant on other nations for its economic survival. The US has to commit more money to chip fabrication development. The issue of America's inability to fabricate chips has become a national embarrassment.

    • See 3 previous
    • Daniel J Daniel J on Feb 20, 2021

      The united states has the ability, just not cheaply. Intel is even pushing more of theirs to be made in Taiwan.

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