The world’s best tech industries around the world are currently battling a global crisis of semiconductor shortage and all the eyes in the world are currently set on the world’s largest contract maker of semiconductors, the Taiwanese Semiconductor Manufacturing Company.
The chip manufacturer is under immense pressure and is reportedly working at more than its 100% capacity to fulfill the orders of its clients. But according to new information the company may have just received a request from the president of the United States which might be a tad bit harder for the chip manufacturer to fulfill.
White House has recently requested TSMC to disclose details about its relationships with suppliers and customers, this includes details such as types of products it produces for clients, lead times, inventory levels, and other information that is deemed confidential. The Taiwanese government is promising to support TSMC if needed.
“We will not leak our company’s sensitive information, especially that related to our customers. We are still at the stage of doing some preliminary research and evaluating the contents of the questionnaire [sent by the U.S. government].”
as we know, the recent boom in the demand for everything electronics including the parts for modern automobiles has caused a massive deficit of various chips, including chips for cars. The automotive industry which employs tens of millions of people worldwide has stopped production of cars due to a lack of chips, and this has escalated to become a significant economic problem.
The automotive sector is one of the most important industries in the U.S. hence the country deems it vital to keep the U.S.-based auto factories working, which in this case means ensuring sufficient chip supply. In a recent attempt to determine bottlenecks in the global semiconductor supply chain, US president Joe Biden has recently asked semiconductor supply chain participants to either voluntarily disclose loads of information about their business or has threatened to force them to make disclosures using a Cold War-era national security law.
“We have other tools in our toolbox that require them to give us data. I hope we don’t get there. But if we have to we will.”
the reason behind the U.S. government taking such strict action is because the US automotive industry has suffered significantly from the ongoing chip shortage, and the government wants to reverse this situation. And to fix the chip shortage the U.S. government wants to address understand how the global semiconductor supply chain operates, something the authorities call ‘transparency.’
The U.S. Department of Commerce had sent a questionnaire to chipmakers, intermediate users of chips, and end-users of chips, however, it asked some details which the TSMC considers confidential.
Here are some excerpts from the document:
- For any integrated circuits, you produce to identify the primary integrated circuit type, product type, relevant technology nodes (in nanometers), and actuals or estimates of annual sales for the years 2019, 2020, and 2021 based on anticipated end-use.
- For the semiconductor products that your organization sells, identify those with the largest order backlog. Then for the total and each product, identify the product attributes, sales in the past month, and location of fabrication and package/assembly.
- List each product’s top three current customers and the estimated percentage of that product’s sales accounted for by each customer.
- For your organization’s top semiconductor products, estimate each product’s (a) 2019 lead time and (b) current lead time (in days), both overall and for each phase of the production process.
- For your organization’s top semiconductor products, list each product’s typical and current inventory (in days), for the finished product, in-progress product, and inbound product. Explain any changes in inventory practices.
- Is your organization considering increasing its capacity? If yes, in what ways, over what timeframe, and what impediments exist to such an increase? What factors does your organization consider when evaluating whether to increase capacity?
- If the demand for your products exceeds your capacity, what is the primary method by which your organization allocates the available supply?
TSMC believes that it cannot answer these questions without disclosing private client information and its commercial secrets.
“Customer trust is one of the key elements to our company’s success. If this is to resolve supply chain issues, we will see how best we can do to help them. We have done so many things. For the part of auto chips, we’ve tried to increase output and prioritize auto chips to a certain degree.”
