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Biden Seeks $37B In Congressional Funding To Counter Chip Crisis: Reuters

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Biden Seeks $37B In Congressional Funding To Counter Chip Crisis: Reuters
  • President Joe Biden said aims $37 billion in funding from Congress to counter the U.S. semiconductor chip crisis that has affected the  U.S. automakers, including Ford Motor Co (NYSE: F) and General Motors Co (NYSE: GM) and other manufacturers, including Intel Corp (NASDAQ: INTC), Qualcomm Inc (NASDAQ: QCOM), Micron Technology Inc (NASDAQ: MU), and Advanced Micro Devices Inc (NASDAQ: AMD), Reuters reports.
  • Biden signed an executive order on Wednesday to address the crisis that was further perpetuated by the pandemic.
  • Biden is reportedly looking forward to a solution that included measures towards production capacity boost. The executive order launched a 100-day review of supply chains for four critical products, including semiconductor chips, large-capacity batteries for electric vehicles, rare earth minerals, and pharmaceuticals.
  • The order also directed six sector reviews focused on defense, public health, communications technology, transportation, energy, and food production.
  • A supply crisis has plagued the U.S. since the pandemic, which reduced the availability of masks, gloves, and other personal protective equipment, impacting frontline workers.
  • Ford Motor endorsed Biden’s initiative as the crisis can reduce the company’s production by up to 20% in the first quarter. General Motors Co was also forced to cut production output in the U.S., Canada, and Mexico.
  • U.S. semiconductor companies account for 47% of worldwide chip sales but account for only 12% worldwide production.
  • Biden has been under pressure from Republican lawmakers to increase protection of the American supply chains from China through investment in domestic manufacturing of next-generation semiconductor chips.
  • The White House aims to diversify the U.S. supply chain dependence for certain products via domestic production boost and partnership with Asian and Latin American countries. The review will focus on import restrictions of certain materials and training U.S. workers.
  • Image Courtesy: Wikimedia
 

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