U.S. senator contacts Taiwan representative over auto chip shortage

02/26/2021 01:13 PM
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Taiwan's representative to the United States Hsiao Bi-khim. CNA file photo

Washington, Feb. 25 (CNA) American Senator Debbie Stabenow said Thursday she had contacted Taiwan's representative to the U.S. regarding the global shortage of automobile chips, which she estimated was caused mainly by reduced shipments from a major Taiwanese semiconductor company.

"U.S. manufactures of automobiles, home appliances, and other products, are being forced to shut down a line or a plant temporarily because of a single company in Taiwan, which has reduced its shipments of semiconductor chips to our manufacturers," Stabenow said at a confirmation hearing for U.S. Trade Representative nominee Katherine Tai.

The Democratic senator from Michigan said she had raised the issue with several people in the new administration of U.S. President Joe Biden and also with Hsiao Bi-khim (蕭美琴), Taiwan's de facto ambassador to Washington.

In response, Hsiao told reporters in Washington that she had explained to several members of Congress, who had expressed similar concerns, that chip manufacturers in Taiwan had been forced to reassign production in 2020 because of a sharp drop in orders, as automakers had anticipated poor sales amid the COVID-19 pandemic.

It was a decision made by the private sector, Hsiao said, adding that chip manufacturers in Taiwan are now working to increase production to meet market demand.

Meanwhile, Rupert Hammond-Chambers, president of the Virginia-based U.S.-Taiwan Business Council (USTBC), said Thursday that Stabenow's remark on the issue was "incorrect and misleading."

The chip supply issue facing the American automobile industry is "primarily a function of the industry itself miscalculating its production needs," Hammond-Chambers said in a statement on the USTBC website.

The flow of semiconductor chips is a commercial matter, with companies placing orders based on expected demand, and those orders are executed along legally contracted boundaries, he said.

"The absence of enough chips to run American plants is absolutely not a function of any deliberate punitive actions by a Taiwan company," Hammond-Chambers said. "It is instead the result of American manufacturers failing to order enough chips."

In recent months, the U.S. has been seeking help from Taiwan, home to the world's largest contract chipmaker, to alleviate the shortage of automobile chips.

In a letter dated Feb. 17, U.S. National Economic Council Director Brian Deese broached the issue with Taiwan's Economic Affairs Minister Wang Mei-hua (王美花), according to the White House.

Earlier in the month, more than 30 Taiwanese business leaders took part in a virtual discussion between the U.S. and Taiwan on enhancing supply chain cooperation and development goals in the semiconductor industry.

However, no agreement was reached on how to quickly alleviate the shortage of automotive semiconductor chips, Wang said.

In a related development, President Biden on Wednesday signed an executive order to review the global supply chains used by four key industries to prevent shortages of semiconductors, medical equipment and other products.

(By Chiang Chin-yeh and Chung Yu-chen)

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