MPs launch inquiry into UK semiconductor industry amid global shortages

theguardian.com:

MPs have launched an inquiry into the strengths and weaknesses of the UK semiconductor industry and its supply chain, after months of global shortages and disruption that have hit production of cars, electronics and home appliances.

The announcement of the business, energy and industrial strategy (BEIS) committee’s inquiry comes just days before a decision is expected in the controversial proposed takeover of the UK’s largest microchip manufacturer Newport Wafer Fab by a Dutch company owned by Chinese-backed Nexperia.

Semiconductors, also known as computer chips, are the “brain” within every electronic device, and have been in short supply since the start of the pandemic, when Asian factories shut down as Covid-19 spread.

Even though production was not halted for long, the semiconductor industry has not been able to manufacture enough to keep pace with rocketing demand for products that require higher numbers of chips such as electric vehicles, 5G-enabled mobile phones and games consoles, including the PlayStation 5.

The British automotive industry’s output was knocked in 2021 by semiconductor shortages, which contributed towards a slump in car manufacturing to the lowest levels since 1956. Chips are used in cars in everything from entertainment systems to controlling windscreen wipers and electric car batteries.

Most of the world’s semiconductors are produced in factories in Taiwan and South Korea, although China has been trying to increase its dominance in the sector.

The use of chips for military purposes means access to them is considered a national security matter.

Darren Jones, who chairs the BEIS committee, said: “Semiconductors are growing in technological and geopolitical importance. With scarce global supply, it’s