The ongoing global shortage of semiconductor chips has hit the auto industry hard, including General Motors, which has been forced to curtail production in response. Now, President Biden says the U.S. Senate is readying legislation to address the shortage.
According to a recent report from Reuters, President Biden recently discussed the chip shortage while outlining his administration’s national infrastructure plans, indicating that U.S. Senate leaders would soon introduce new legislation to address the issue.
“We’re working on that,” Biden said in regard to the shortage. “[Senate Majority Leader] Chuck Schumer and, I think, [Senate Republican Leader Mitch] McConnell are about to introduce a bill along those lines.”
This coming Monday, the White House will hold a virtual summit with several U.S. automobile executives, including General Motors CEO Mary Barra, as well as Ford Motor Company CEO Jim Farley.
Earlier in the week, the Alliance for Automotive Innovation, a trade group representing several major automotive manufacturers and suppliers, including General Motors, pressed the U.S. government to address the global semiconductor shortage. In a letter, the group asked for federal funding “to build new capacity that will support the auto industry and mitigate the risks to the automotive supply chain.” Group members also include BMW, Bosch, VW, Ford, Cruise, Denso, Toyota, Hyundai, and others.
It’s estimated the shortage could result in 1.28 million fewer vehicles built in 2021, and could affect production for another six months. Some estimate that the shortage will result in 60,000 fewer GM vehicles built this year in North America alone, as well as 216,000 fewer vehicles globally. GM estimates that the shortage could cut into its earnings for 2021 by as much as $2 billion.
In February, President Biden signed an executive order for $37 billion in funding to support semiconductor chip manufacturing in the U.S.