Several trade groups and unions, including the Alliance for Automotive Innovation and the UAW, sent a letter to Congress this week urging it to provide funding for the Chips Act.
The Chips Act was signed into law this year as part of the 2021 defense bill, but never received funding from Congress. The letter, which was delivered to House Speaker Nancy Pelosi, Senate Majority Leader Chuck Schumer, House Minority Leader Kevin McCarthy and Senate Minority Leader Mitch McConnell this week, claims strengthening America’s semiconductor chip manufacturing abilities is a “national priority.”
“To be competitive and strengthen the resilience of critical supply chains, we believe the U.S. needs to incentivize the construction of new and modernized semiconductor manufacturing facilities and invest in research capabilities,” the letter said, as quoted by Bloomberg. “The need is urgent and now is the time to act. We look forward to working with you on this national priority.”
The US Senate previously passed a bill that would funnel $52 billion into domestic semiconductor manufacturing efforts. The money was part of a broader $250 billion package called the US Innovation and Competition Act, which also covers other important areas of industry including sciences and artificial intelligence. The bill is still awaiting House approval, however, and American unions and other industry trade associations want to see the federal government take action sooner rather than later.
“While the governments of our global competitors have invested heavily to attract new semiconductor manufacturing and research facilities, the absence of comparable U.S. incentives has made our country less competitive and America’s share of global semiconductor manufacturing has steadily declined as a result,” the letter also said.
U.S. Commerce Secretary Gina Raimondo said this week the Biden Administration is “starting to see some improvements,” with regard to semiconductor chip supply and that the Detroit Big Three have told her they are now getting “little bit more of what they need,” with regard to semiconductor chips. Still, Raimondo urged the House to pass the $52 billion in funding before it recesses in August.
“What I say is we need to get this done this summer,” Raimondo told reporters this week. “They can’t recess this August without having gotten this done.”
A global shortage of silicon wafer chips has crippled the U.S. auto industry in recent months, hampering production output and leading to low inventories at dealerships.
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Comments
Another bailout.
My local Chevy dealer who boasts of the largest inventory in Illinois and one of the top sellers in the nation looks like they’re going out of business. From Roger Smith to Roger Smith with a bra the only constant this company has had is cringe worthy management.
Here’s a thought, build your own plant in the U.S. or Canada, not in third world North America. Pay a good wage and control your own inventory.
Or better yet congress could remove any and all regulations pertaining to building and staffing a new U.S. chip plant under national security concerns.
Right, another government bailout, what a bunch of short sighted losers. How come it has taken such an event in order for these automakers to finally realize they can’t rely on other suppliers from around the world to make everything for them, and not expect some sort of major supply shortage?
Even with a government handout that all of us tax payers have to pay for and suffer the ultimate consequences of higher inflation, these American companies will have to pay much higher wages to workers here in the U.S. and the cost structure will have to go up in price for each chip or semi-conductor. That will be a financial hit the automakers are have to be willing to take. But at the end of day, they will have much better control and won’t have to worry about these shortages anymore.
At least it will bring back some high paying manufacturing jobs to the U.S., I still don’t like the government being involved in this at all, GM and others need to invest their billions of dollars into the making semi-conductors especially now more than ever since EV’s won’t be able to operate without one.
With Joe at the helm this will be a big mess that the taxpayer will have to cover.
Pathetic socialization of the USA. Slipping slipping slipping.
If tesla sent that same letter. Does anyone believe our government would even read such a letter let alone deploying a massive taxpayer funded plan of attack?
Taxpayers should be extremely concerned as government has proven its fierce loyalty to the likes of gm and ford, and government has also proven their loyalty to ford and gm runs deeper than their loyalty to taxpayers. Their fierce loyalty is on full display each time they answer the call each time ford and gm runs themselves into a jam. Jams that most always involve a massive taxpayer investment to fix. These sudden jams which they foolishly claim as no fault of their own but are circumstantial. And government immediately goes into bulls$#t mode attempting to sell taxpayers of ford and GMs foolish claims of circumstances which caused their jam. Government then pisses down taxpayers backs saying its raining by assuring taxpayers their massive donation will somehow benefit them.how exactly does it benefit taxpayers to continuously finance private businesses which are failures on world stage? In fact it seems to me if given choice tesla would be better investment for public. At least their investment would support a well run functional company
Known as “integrated manufacturing” back in the day.
Now everything’s supplied by an outside source. Might explain rising cost as well…
Instead of asking the government to implement something at the cost of the taxpayer, why doesn’t GM build their own chip facility? Quit asking for taxpayers and everyone else to support them and start building their own parts. Maybe then they wouldn’t have these problems. Who knows, maybe the quality of their vehicles might even improve.
What happened to silicone valley in
California we used to be number one in
In chip making ,Intel used to be in Olympia what happened to them.so we go around the world to get a cheep and
singular availability for chips and programs.
Havnt you heard we tossed most evry pot of gold at rainbows end in the trash. The real spoils of development are the long term residuals of manufacturing. Manufacturing offers more long term stability than to those who developed it. And amazingly it took this chip stunt to show our country that manufacturing controls even those who developed it. And even if government attempts to suddenly throw massive taxpayer investment into funding startup of private chip makers it could be something different the next day. And more alarming is not only taxpayers funding private business is the simple fact that obviously it’s not profitable to sustain the manufacturing of products we developed or investors would already be doing it. Imagine if china flexed their muscles and refused to manufacture some or even all our needs. Would taxpayers be able to afford massive investments into untold manufacturing demands to a
ttract private business? It’s a gamble that chip makers will not fail and require endless tax dollars to support them.
Think about this the product they hold us ransom to currently is needed for one of our last manufacturing strongholds. The car industry which needs to be bailed out by taxpayers consistantly. Why think suddenly we can grow up and once again deliver our own needs. And make america great again
It is 30% to 50% cheaper to make chips in Taiwan or China than in the USA because THOSE COUNTRIES SUBSIDIZE THEIR INDUSTRY. Two solutions – one hurts a lot more than the other – One, we subsize chip making in the US and level the playing field, protecting US security and US supply chains. OR, Two, we tax all incoming chips so the cost is effectively the same and foreign chip makers can’t steal business from US manufacturers. But, boy, will that start something….
Never happens, the USA only taxes Americans because they are in bed with the Chinese and others. Voters make these choices.