White House Seeks to Address Semiconductor Chips Crisis Harming Automakers

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FILE PHOTO: U.S. President Joe Biden holds a semiconductor chip as he speaks prior to signing an executive order, aimed at addressing a global semiconductor chip shortage, in the State Dining Room at the White House in Washington, U.S., February 24, 2021. REUTERS/Jonathan Ernst/File Photo

On Thursday, the White House will meet with major companies to discuss how to address the global shortage of semiconductor chips that has been reducing auto production.

Commerce Secretary Gina Raimondo, White House National Economic Council Director, will host companies, including Detroit’s Big Three automakers General Motors and Ford Motor, as well as Apple and Daimler AG.

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To get more information from the industry about the chip problem and possible solutions to supply chain problems, the White House will issue a voluntary request for information this week.

The administration is seeking comments within 45 days to get details about “supply and demand, inventory, ordering and customer segments,” a Biden administration official told reporters Wednesday.

“We have other tools in the tool kit to survey firms and require information,” the official said, saying they would first seek voluntary efforts.

Another official said that the Biden administration plans to set up a voluntary “early alarm system for COVID-19-related shutdowns to microelectronics manufacture around the world,” collecting information from U.S. embassies and other affected businesses.

The administration wants to make sure it “maximizes our technical and material support to these locations in order to keep key semiconductor manufacturing plants and other important facilities running.”

The rise in COVID-19 infection has slowed production at parts factories located in Vietnam and Malaysia. This has led to a global shortage of auto chips.

The Taiwanese economy minister, a major chip manufacturer, stated last month that it was working hard to solve the global shortage of semiconductors.

As Taiwan tries to assure the United States, its largest international supporter, and arms supplier, it has taken on a diplomatic tone. This is especially important considering that Taipei is under increasing military pressure from China which regards Taiwan as its own.

Data firm IHS Markit stated last week that global production of light vehicles will drop by five million due to semiconductor shortages, delayed packaging, and testing of the chips. Some automakers believe the crisis could last into 2023 or late 2022.

Due to limited chip supplies, automakers from GM and Toyota Motor Corp have seen their output and sales decline. This was made worse by a COVID-19 resurgence at key Asian semiconductor production centers.

GM cut production at its largest North American plant earlier this month.

Other companies that attended Thursday included AMD, Applied Materials, and Medtronic.

The White House is asking Congress to approve $52 Billion to increase U.S. semiconductor chip production.