What do a phone, a car, an airplane or even the Ariane rocket have in common? Inventions of the last century crammed with chips and semiconductors, those little pieces that in just a few months have become the new black gold that everyone snaps. To understand this global shortage, which several estimates suggest will continue “through 2022,” we need to understand the path these chips take between our phones and their manufacturing facilities.
If they were designed in Uncle Sam’s country or in Europe, they are very (very) largely made in Asia. TSMC is the undisputed champion of the production of semiconductors in the world and produces for the largest such as Apple or Intel. However, the Taiwanese company is at the center of a geopolitical conflict that looks like a trade war. Mainland China does not see the emergence of a strong industry in Taiwan badly.
A conflict that has a direct impact on Europe. The automotive group Stellantis, which emerged from the merger of Peugeot-Citroen with Fiat-Chrysler, was unable to produce 190,000 vehicles in the first quarter of this year 2021 due to a lack of parts. Demand for semiconductors and computer chips, especially because of the pandemic. Indeed, the implementation of teleworking on a massive scale has forced millions of people to equip themselves with computers, which is greatly increasing the demand. Asian production couldn’t keep up.
European dependency at the heart of the problem
Faced with this shortcoming, all actors in the industrial world make the same observation. Europe depends on Asia for its semiconductor supplies, and China, the main power in the eastern Urals, is raining and shining on European factories. To make things worse in Europe, the blockage of the welding duct by the ship Evergreen a few weeks ago further prolonged the delivery delays for the valuable semiconductors that were blocked in the Egyptian artificial asana.
“A factory costs at least 3 to 4 billion,” and that’s the whole problem, summarizes Alain Librati, founder of Synergie CAD, which specializes in the production of electronic cards. To get a European company at TSMC level, it takes “a turnover of 50 to 60 billion” with a very high failure rate. No one therefore wants to take out the XXL checkbook to compete with the Taiwanese giant.
According to Alain Librati, the problem is not coming directly from TSMC, the company everyone has been pointing out since the shortage began, but from Chinese intermediaries blocking it. A real trade war led by Beijing against Taiwan.
In order to get out of the current crisis, Europe does not remain indifferent either, and many measures are being taken in Brussels to solve this problem of supply and de facto dependency. Thierry Breton, the EU commissioner responsible for domestic trade, has also met several large European and American companies that specialize in the production of chips, such as TSMC or Samsung in Asia. But the French commissioner’s inquiries found no echo across the Atlantic, and companies are seldom able to invest the amounts requested on the old continent.
Because beyond the initial investment, the technological lag compared to astatic companies is enormous. TSMC is preparing 2 nm chips, Samsung too. Europe today has the knowledge to manufacture 28 nm chips. A prehistoric piece in the history of arithmetic that will never find a buyer on the market.