Has the Semiconductor Supply Shortage Peaked? US Commerce Secretary Says "Situation Is Improving"

Goldman Sachs: "Q2 Marks Peak of Supply Shortage... Production Expected to Rebound"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kim Suhwan] The U.S. Biden administration has expressed the view that the semiconductor supply shortage is showing signs of being resolved in the near future.

On the 20th (local time), Bloomberg News, citing government officials, reported that U.S. Secretary of Commerce Gina Raimondo recently gave an optimistic assessment of the semiconductor supply outlook, stating that "the situation is improving" regarding the supply shortage.

The media further reported that the U.S. government is establishing communication channels between domestic automobile manufacturers and semiconductor manufacturers to resolve the semiconductor supply shortage.

Specifically, it is reported that Secretary Raimondo has recently been chairing a series of meetings between senior executives of semiconductor companies and automobile manufacturers.

Previously, automobile manufacturers pointed out transparency issues with foundry companies, stating that semiconductor foundry (contract manufacturing) companies have not been disclosing detailed information about production volumes related to the supply shortage. On the other hand, foundry companies rebutted by saying that automobile manufacturers caused the semiconductor shortage by sharply increasing recent order volumes.

As trust issues between semiconductor producers and their clients have emerged, it appears that the U.S. government is establishing communication channels to build mutual trust in order to resolve the semiconductor supply shortage.

Earlier, Goldman Sachs also released a report last month stating that the second quarter was the peak of the semiconductor supply shortage and analyzed that "car production will rebound from July."

[Image source=Reuters Yonhap News]

Additionally, Taiwan's foundry company TSMC announced last week that it will increase production of microcontrollers, a type of automotive semiconductor, by about 60% within this year.

Moreover, the U.S. Department of Commerce has prepared a $52 billion (approximately 60 trillion KRW) plan for expanding semiconductor production and research and development, which was recently submitted to Congress. The related budget bill passed the Senate last month and is currently under review in the House of Representatives.

The U.S. government is also reported to be closely consulting with authorities of countries in the Southeast Asian region, where semiconductor factories are concentrated, to restart factories there.

Earlier this month, some semiconductor factories in Malaysia were shut down due to a resurgence of COVID-19. In response, the Biden administration reached an agreement with local authorities to restart those factories.

Furthermore, Bloomberg News reported that U.S. authorities are currently in discussions with the Vietnamese government regarding plans to operate semiconductor factories amid the ongoing spread of COVID-19 in Vietnam.

This content was produced with the assistance of AI translation services.