Dealing With the Lack of Chips Deemed as Critical as Securing Food in Japan

The global chip shortage has significantly hit most industry sectors out there, and carmakers are still struggling to find a way to deal with it without recording a massive impact on their operations.
Some carmakers temporarily stopped the manufacturing of cars due to the lack of chips 1 photo
Photo: General Motors
Unfortunately, however, most still have to temporarily halt the production of certain models, as foundries across the world can’t fill all orders despite working 24/7.

Japan is one of the countries trying to deal with the lack of semiconductors as we speak, with the local Ministry of Economy, Trade, and Industry now turning this whole struggle into a national project that's as important as securing food, according to local media.

More specifically, the Japanese authorities want the local manufacturing of chips to increase after a massive slowdown recorded in the last decade.

According to data from The Japan Times, the country still has 84 chip factories, but the number of high-end products they are currently manufacturing is extremely reduced. Back in 1988, Japan controlled no less than 50 percent of the global semiconductor market, while in 2019, this share dropped to no less than 10 percent, which means the country has to import more than 60 percent of the chips local companies need.

The government wants to invest in semiconductor manufacturing, and to do this domestic firms will be encouraged to establish joint ventures with foreign chip makers in an attempt to increase local operations, especially in the high-end chip sector.

At the same time, the ministry wants the existing chip manufacturers in Japan to be upgraded in a way that would allow them to address the local need of semiconductors better, and for some, this means overhauling their production lines to build high-end products.

Needless to say, Japan isn’t the only country planning to spend big on semiconductor manufacturing, with several other nations, including the United States, also trying to invest in high-end chips that would serve a wider array of industry sectors, including for the production of cars.
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About the author: Bogdan Popa
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Bogdan keeps an eye on how technology is taking over the car world. His long-term goals are buying an 18-wheeler because he needs more space for his kid’s toys, and convincing Google and Apple that Android Auto and CarPlay deserve at least as much attention as their phones.
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