The nation’s electronics sector could face disruptions in raw material supplies as early as next month due to the COVID-19 outbreak in China, the Taipei-based Chinese National Federation of Industries (CNFI, 全國工業總會) said on Saturday.
Citing a survey of its 157 member companies, the group said that tech companies are concerned about the availability of raw materials, as many Chinese manufacturers have not yet returned to full production since reopening on Monday last week after several extensions of the Lunar New Year holiday break.
Lockdown policies in at least 48 cities and four provinces across China, and travel restrictions that have shut down highways, railways and public transportation systems have restricted the movement of millions of people and limited the size of factory workforces at numerous plants.
The CNFI said that the electronics sector has been severely affected by the city lockdowns.
Many Taiwanese electronic components makers have built clusters of production sites in Hubei and Guangdong provinces, the two regions hit the hardest by the COVID-19 outbreak, and city lockdowns to restrict movement are the last thing tech companies want, the industry group said.
Hubei’s capital, Wuhan, the center of the outbreak, and neighboring Xiantao and Huangshi have become a production hub for many Taiwanese printed circuit board makers, but these cities have been sealed off and raw material shipments interrupted, the group said.
Even when manufacturers secure approval from local governments to resume production, workers have to stay in quarantine for 14 days before starting production line duty, which has slowed output, it said.
As for the biotech industry, many drug manufacturers in Taiwan are expected to soon face raw material supply shortages from China as their inventories run out, CNFI said.
The outbreak has also hurt private consumption in China, which would affect Taiwanese makers of consumer electronics items, such as chip and optoelectronic products, it said.
Under such unfavorable circumstances, some small and medium-sized enterprises in Taiwan are expected to face capital shortfalls as their operations deteriorate, it said.
Those organizations would still have to pay salaries, rents and loan interest, so their financial burden would be heavier until production returns to normal, the group said.
Many businesses are hoping the government would help them negotiate with banks to resolve possible funding issues, it added.
SEEKING CLARITY: Washington should not adopt measures that create uncertainties for ‘existing semiconductor investments,’ TSMC said referring to its US$165 billion in the US Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) told the US that any future tariffs on Taiwanese semiconductors could reduce demand for chips and derail its pledge to increase its investment in Arizona. “New import restrictions could jeopardize current US leadership in the competitive technology industry and create uncertainties for many committed semiconductor capital projects in the US, including TSMC Arizona’s significant investment plan in Phoenix,” the chipmaker wrote in a letter to the US Department of Commerce. TSMC issued the warning in response to a solicitation for comments by the department on a possible tariff on semiconductor imports by US President Donald Trump’s
The government has launched a three-pronged strategy to attract local and international talent, aiming to position Taiwan as a new global hub following Nvidia Corp’s announcement that it has chosen Taipei as the site of its Taiwan headquarters. Nvidia cofounder and CEO Jensen Huang (黃仁勳) on Monday last week announced during his keynote speech at the Computex trade show in Taipei that the Nvidia Constellation, the company’s planned Taiwan headquarters, would be located in the Beitou-Shilin Technology Park (北投士林科技園區) in Taipei. Huang’s decision to establish a base in Taiwan is “primarily due to Taiwan’s talent pool and its strength in the semiconductor
Industrial production expanded 22.31 percent annually last month to 107.51, as increases in demand for high-performance computing (HPC) and artificial intelligence (AI) applications drove demand for locally-made chips and components. The manufacturing production index climbed 23.68 percent year-on-year to 108.37, marking the 14th consecutive month of increase, the Ministry of Economic Affairs said. In the first four months of this year, industrial and manufacturing production indices expanded 14.31 percent and 15.22 percent year-on-year, ministry data showed. The growth momentum is to extend into this month, with the manufacturing production index expected to rise between 11 percent and 15.1 percent annually, Department of Statistics
An earnings report from semiconductor giant and artificial intelligence (AI) bellwether Nvidia Corp takes center stage for Wall Street this week, as stocks hit a speed bump of worries over US federal deficits driving up Treasury yields. US equities pulled back last week after a torrid rally, as investors turned their attention to tax and spending legislation poised to swell the US government’s US$36 trillion in debt. Long-dated US Treasury yields rose amid the fiscal worries, with the 30-year yield topping 5 percent and hitting its highest level since late 2023. Stocks were dealt another blow on Friday when US President Donald
RSS