Monday, January 25, 2021

Germany Urges Taiwan To Ease Chip Shortages; Volkswagen Looks To Claim Damages From Suppliers

Germany is asking Taiwan to persuade its domestic semiconductor manufacturers to help ease chip shortages in the auto sector. According to a report by Reuters, the bottlenecked supply of semiconductors is hampering the former’s economic recovery from the COVID-19 pandemic.

Chip shortages have affected various automakers around the world, including companies such as Volkswagen, GM Motors, Nissan and many others. This resulted in the shutting down of assembly lines which has slowed down vehicle production from car brands.

The report says that German economy minister Peter Altmaier has requested his Taiwanese counterpart Wang Mei-hua to address the issue in talks with Taiwan Semiconductor Manufacturing Co Ltd (TSMC). In a letter addressed to Wang, Altmaier is asking Taiwan to enable additional capacities and deliveries of semiconductors in the short and medium term.

Taiwan’s Ministry of Economic Affairs said it has begun talks with domestic chip suppliers in response to requests from other countries. “The relevant supply and demand situation is also closely related to the plans of automotive chip factories to reduce inventory during the off-season,” the ministry said.

Meanwhile, according to another Reuters report, automaker Volkswagen is in talks with chip manufacturers about possible claims for damages caused by the shortages. A company spokesperson said that aside from this, its top priority is to minimise the effects of the semiconductor bottleneck on its production, and to resolve the problem in close cooperation with its suppliers.

TSMC, on the other hand, said the issue of chip shortages for auto companies was very important to them. “It is our top priority, and TSMC is working closely with our automotive customers to resolve the capacity support issues,” the company said in a statement.

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