JAPAN NEWS



 

The government has asked authorities in Taiwan, the world’s largest production base for semiconductor products, to increase output because semiconductor chips for automobiles are in short supply all over the world.

If the negative effects spread in the automobile industry, on which a wide range of related companies depend, it may damage the Japanese economy. Thus quick responses to resolve the problem are required.

This month, the Japanese government asked the Taiwan authorities to increase production volumes of semiconductor chips for automobiles via the Japan-Taiwan Exchange Association, which is Japan’s liaison organization with Taiwan.

It is likely that Germany made a similar request of Taiwan.
TSMC, a Taiwan company that is the world’s largest contracted manufacturer of semiconductor products, told The Yomiuri Shimbun that it is speeding up in response and is increasing its production volume.

Production volumes for automobile semiconductor products have declined due to the novel coronavirus pandemic, and semiconductor manufacturers have shifted production priorities to parts for personal computers and peripheral devices since around spring last year, as demand for those products has grown amid the increase in teleworking.

Semiconductor products are designed for specific uses in each kind of product, which means that changing production processes is not easy.
Production of semiconductor chips for automobiles “is seen as less important than those of other electronic products,” said an analyst.

About 40 semiconductor products are used in each modern-day automobile — even standard models. The number is even higher in luxury cars with self-driving or other high-level functions, and in electric vehicles.

Japanese manufacturers of semiconductor products include Renesas Electronics Corp. and Kioxia Corp., which is a group firm of Toshiba Corp.

However, the Japanese companies’ main products are not semiconductor chips that meet regulations for use in automobiles, so automakers worldwide have relied on Taiwan manufacturers.

In Japan, there has already been criticism that the nation’s production systems for semiconductor products are fragile.

The current problem, a manifestation of that concern, comes in the midst of a move to lure manufacturing plants of TMSC and others into Japan behind the scenes. The move is led by the Economy, Trade and Industry Ministry.

Concerning electric vehicles, on which automakers place importance, procurement of not only semiconductor products but also rare metals has been seen problematic, because securing rare metals largely relies on China.

For the Japanese automobile industry to maintain its competitiveness, it is increasingly important to reexamine how to procure parts.