TSMC says other clients can ‘fill gap’ if US ban hits Huawei

Linda J. Dodson

TAIPEI — Taiwan Semiconductor Manufacturing Co., the world’s biggest contract chipmaker, said on Tuesday that other customers are ready to step in and fill the gap if U.S. sanctions force the chipmaker to cut ties with Huawei, its second-largest customer.

TSMC Chairman Mark Liu was asked at the company’s shareholders meeting whether the chipmaker will be able to find other clients. “Of course we hope other customers could soon make up the orders if we lose [business from] Huawei chip unit HiSilicon. We do see other customers and players hoping to fill any gap HiSilicon might leave — whether that’s in terms of our own production capacity, or in the smartphone market.”

Liu added, however, that he hopes “these assumptions do not happen.”

TSMC supplies almost all of the world’s biggest tech brands and chip developers — some 500 in total — including Apple, Google, Qualcomm, Nividia, AMD, Huawei, NXP and many others.

The latest U.S. crackdown on Huawei, however, which requires non-U.S. companies to obtain a license if they use American technology to fulfill orders for the Chinese company, threatens TSMC’s relationship with one of its most important customers.

The chipmaker has already halted processing new orders from Huawei, as the Nikkei Asian Review first reported on May 18, though it is allowed to process existing orders, provided they are delivered before mid-September.

The new U.S. restriction came the same day that TSMC announced its intention to build a $12 billion chip facility in the U.S. state of Arizona, and Liu acknowledged that the Taiwanese chip titan is caught up in Washington-Beijing tensions.

“Not only TSMC but all companies on the planet are caught in between the geopolitical fight between the world’s two biggest countries,” he said. “What matters is how we navigate these geopolitical uncertainties and resist all these headwinds.”

TSMC relies heavily on chip production tools and materials from the U.S., Liu said, and the company “will continue collaboration with American vendors because those leading tools are also the key for TSMC to maintain its lead in tech and manufacturing excellence.”

Liu also defended the decision to build the chip facility in Arizona, saying the move would help the company attract top global talent.

Looking forward to the second-half, the chipmaker says it sees a lot of uncertainties but still expects its revenue and profit to continue to grow this year.

Source Article

Next Post

Small businesses ‘spend twice as much as much’ by using wrong Government loan scheme

Small businesses which rushed to take out a taxpayer-backed coronavirus support loan could be paying double the amount needed to secure the support. Firms that acted swiftly to secure cash through the Treasury’s initial Coronavirus Business Interruption Loan Scheme (Cbils) are typically paying far higher charges than those which waited for […]