US secretary of commerce, Gina Raimondo, has met with senior executives in the semiconductor supply chain, including carmakers Ford, GM and Stellantis, to find ways out of current shortage in the supply of the electronic components.
Following the latest meeting, held last Thursday (May 20), Raimondo said: “Semiconductors play a unique role in our economic and national security, and when semiconductor supply chains are disrupted, the impact is felt across the economy. Addressing the semiconductor shortage and strengthening the domestic supply chain is a priority of mine and for the Biden-Harris Administration.”
The meeting follows the signing by US president Biden of an executive order designed the fortify US supply chains, including those supporting the production of semiconductors and EV batteries. The order set up a 100-day review of four products – semiconductors, key minerals and materials, advanced batteries such as those used in electric vehicles, and pharmaceuticals. The review involves ongoing discussions between government and industry designed to address the semiconductor shortage.
Last month the review included a summit on semiconductors and supply chain resilience, which again involved industry leaders, including those from the automotive industry and from the electronics suppliers. Following that, the Biden administration proposed setting aside $50 billion of its $2 trillion infrastructure plan for the semiconductor industry, with the emphasis on domestic production of chips.
However, the meetings have so far not singled out the automotive industry as a priority for help, contending as it is with the electronics and medical device sectors, amongst others.
Speaking after the April summit Matt Blunt, president of the American Automotive Policy Council (AAPC), which represents Ford, GM and Stellantis, thanked the administration for working to address the global shortage in automotive-grade semiconductor wafers.
“It is imperative that all efforts are made to ensure our auto industry remains indispensable to the US economy and American jobs.”
Currently, only 12% of global semiconductor manufacturing capacity is located in the US and the shortage globally is affecting plants around the world, including in North America.
Raimondo said that the conversations being held with industry continued to be “incredibly useful”.
“Our hope is these conversations will lead to solutions not only for the near-term shortage, but also measures to strengthen the domestic supply chain in the long-term,” she added.
Earlier this month the AAPC joined the Motor and Equipment Manufacturers Association (MEMA) and the UAW union in urging congressional leaders in the US to support initiatives to strengthen and secure our domestic supply chains, particularly the semiconductor supply chains that it said were posing a threat to the country’s post-pandemic recovery. Responding to the proposal for $50 billion of support Matt Blunt said:
“We enthusiastically support the president’s proposal to include $50 billion in federal funding to restore US semiconductor manufacturing. Working together, our groups manufacture most of the cars, light- and heavy-duty trucks, and motor vehicle components produced by American workers in the United States.
He went on to say that Ford, GM and Stellantis were responsible for 10.3m jobs and $650 billion in wages for employees.
“As a result, we believe any legislation to fund multi-billion-dollar federal incentives to private semiconductor firms should prioritise production of the semiconductors necessary to assemble vehicles here in the United States. This will ensure that motor vehicle manufacturers have a fair share of chips needed to meet consumer demand.”