Taiwan mobile supplier describes China-US trade conflict as 'new challenge'

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The trade conflict between China and US may upset the Apple supply chain, a major iPhone components supplier Taiwan Semiconductor Manufacturing Co Ltd (TSMC) warned, Financial Times reported Monday.

Morris Chang, founder and outgoing chairman of TSMC, which supplies processor chips for iPhone, described the current trade dispute as “a new challenge,” according to the report.

Chang’s comments came after the world’s two largest economies finished the first-round trade talk last Friday with little progress.

TSMC manufactures most of iPhone's core processor chips at its factories in Taiwan, and the mobile devices business generates about half of TSMC’s 33 billion US dollars annual revenue.

But most iPhones are assembled in Chinese mainland with many Taiwan electronics manufacturers in Apple’s supply chain, such as Foxconn, setting their major factories there.

Therefore, a full-blown trade war between China and US may impact the entire mobile device supply chain, including components makers like TSMC, Chang said.

However, unlike enterprises worried about the negative influence from the trade conflict, Taiwan authorities followed the US ban on sale to China’s ZTE Corp and issued a restriction on local companies’ supply to ZTE, Taiwan newspaper Economic Daily reported Monday.

Taiwan’s largest memory chips maker, Nan Ya Tech Corp said that under the requirement of Taiwan authorities, the company has applied for approval before selling products to ZTE and now waiting for the feedback, according to the report.