Chip makers in drought-affected Taiwan are buying water with a truck

Taipei: Taiwanese chipmakers are buying water by truckload for some of their smelters as the island expands water supply restrictions amid droughts that could worsen the chip supply crisis for the global auto industry.

Some auto makers have already been forced to reduce production, and Taiwan has received requests to help fill the shortage of car chips from countries including the United States and Germany.

Taiwan, a major hub in the global technology supply chain for giants like Apple, on Thursday will begin reducing water supplies to factories in central and southern cities where major science parks are located.

Water levels in many reserves in the central and southern region of the island are less than 20%, after months of scarce rainfall and a rare summer devoid of hurricanes.

“We have planned for the worst,” Taiwan Economy Minister Wang Mi-hwa told reporters on Tuesday. “We hope companies can reduce water use by 7% to 11%.”

With limited rainfall forecasts for the coming months, Taiwan Water Corporation said this week that the island has entered its “toughest moment”.

Taiwan Semiconductor Manufacturing Co Ltd (TSMC), the world’s largest chip maker, this week began ordering small quantities of water by truckload to supply some of its facilities across the island.

“We are making preparations for our future demand for water,” TSMC told Reuters, describing the move as a “pressure test.” The giant chip company said it had not seen any impact on production.

Vanguard International Semiconductor Corporation and United Microelectronics Corp. have signed contracts with water trucks and said there is no impact on production.

Vanguard said it has begun training to transport water by truck to its facilities in the northern city of Hsinchu.

Taiwanese tech companies have long complained of chronic water shortages, which became more severe as factories expanded production in the wake of the Sino-U.S. Trade war.

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