‘Chipageddon’: How Taiwan is battling the global chip shortage
Semiconductors are the lifeblood of the modern world, but now there is a critical shortage worldwide and Taiwan is at the center of it. In May, Japanese automobile giant Nissan was forced to put the brakes on its vehicle production and cut its manufacturing output for 2021 by 500,000 units. The reason: a severe shortfall of a coin-sized computer chip needed to power its vehicles. This chip shortage, which has crippled the global automobile industry for the past 18 months, has now spilled over to other sectors. But effort and flexibility among logistics partners are helping to mitigate the crisis and offer ideas for how processes might be improved in the future. Chips, also known as semiconductors, power the modern world. Almost anything electronic, from phones, cars to even an alarm clock, relies on these nano-sized silicon wafers to function. Last year, Taiwan dominated the global market share for semiconductor contract manufacturing, accounting for more than 60 percent of global revenue. “We’re the world’s chipmaking factory. Semiconductor manufacturing is one of the most important industries for Taiwan,” said DJ Shieh, Managing Director of DHL Supply Chain Taiwan. But in the past year, a global pandemic and one of the worst droughts in half a century has severely disrupted production there. Taiwan is also caught in a global tech war between the United States and China. The triple threat has led to a semiconductor shortage crisis so severe that it has been dubbed “Chipaggedon”. “The global chip shortage is affecting every industry. I think very few players expected the sharp fall in supply,” said Shieh. “We’re doing our best to ensure the seamless flow of goods for our semiconductor customers to minimize the fallout, and hopefully resolve, this supply chain crisis.” A perfect storm The Covid-19 pandemic was the catalyst for this […]