Advertisement

Biden: U.S. must 'step up our game' amid semiconductor shortage

By
Don Johnson
President Joseph Biden (C) speaks Monday during the virtual CEO Summit on Semiconductor and Supply Chain at the White House in Washington, D.C. Pool Photo by Amr Alfiky/UPI
President Joseph Biden (C) speaks Monday during the virtual CEO Summit on Semiconductor and Supply Chain at the White House in Washington, D.C. Pool Photo by Amr Alfiky/UPI | License Photo

April 12 (UPI) -- President Joe Biden met Monday with executives from nearly two dozen companies -- including General Motors and Ford -- to address the supply chain shortage of semiconductor chips that's disrupting automobile manufacturing.

Biden and national security and economic advisers met virtually with top executives from 19 companies Monday afternoon.

Advertisement

Biden told company executives he had received a bipartisan letter on Monday from 23 senators and 42 House members in support of his Chips for America program. He said China and the rest of the world are not waiting to invest in semiconductors and batteries and neither should the United States.

"We led the world in the middle of the 20th century. We led the world toward the end of the century, we're going to lead the world again," Biden said.

RELATED GM to close plants in U.S., Mexico this month due to chip shortage

In the Chips for America legislation, the Biden administration is asking Congress for $50 billion to finance research and development for semiconductors. The legislation would subsidize domestic manufacturing and chip research.

"For too long, as a nation, we have not been making the big bold investments we need to outpace our global competitors," Biden said. "To put it bluntly, we need to step up our game."

Advertisement

Press Secretary Jen Psaki said at Monday's White House Press briefing that the summit was "not a meeting where we expect a decision or an announcement to come out of," but part of the administration's ongoing discussion on how to address the issue.

RELATED GM temporarily shutters Missouri plant amid semiconductor chip shortage

Psaki said one reason Biden wanted to attend the meeting was to hear from company executives on what his administration could do to alleviate the shortage.

The meeting aims to examine "steps to strengthen the resilience of American supply chains for semiconductors and other key areas," the White House said in a statement.

The global chip shortage, caused by supply chains sourced primarily from Asia, has slowed auto manufacturing since the start of 2021 -- but also affects national security, White House officials say. Monday's meeting was intended to explore ways to strengthen the U.S. supply chain and other key areas.

RELATED Shortage shows how semiconductor supply was a house of cards

Biden has ordered a review of the federal government's role in moving more semiconductor manufacturing to the United States and making current supply lines more reliable.

The president held a bipartisan meeting on the matter in February and pledged $37 billion to cover the short-term costs of rebuilding and securing American supplies of chips.

Advertisement

The shortage has caused General Motors, Ford and Stellantis, which owns Chrysler, to shutter auto plants as they await more semiconductor chips, which are needed for various parts of vehicles' electrical systems. Many other computerized electronics also rely on the chips.

AlixPartners, a global consulting firm, has projected that the assembly of as many as 2.5 million vehicles could be lost in 2021 and the auto industry could lose $61 billion if the chip shortage isn't solved. AlixPartners says the industry has lost production of 1.4 million vehicles worldwide.

Daleep Singh, deputy national security adviser and deputy director of the National Economic Council, told NPR that semiconductors are critical for most emerging technologies, and the chips are civilian and military in their purpose, including pharmaceuticals, space, weapons systems and satellites.

Singh added that all of the most advanced semiconductors are produced in East Asia, and more than 90% are manufactured by a single company.

"That's a critical vulnerability," Singh told NPR.

At the meeting, Biden also touted his proposed $2 trillion infrastructure plan that includes $50 billion for a new Commerce Department office to coordinate semiconductor manufacturing in the United States.

Advertisement

The chief executives in attendance at Monday's virtual meeting were Mary Barra of GM, Jim Farley of Ford, Carlos Tavares of Stellantis, Sundar Pichai of Google, Thaddeus Arroyo of AT&T, Kathy Warden of Northrop Grumman, Enrique Lores of HP, Patrick Gelsinger of Intel, and others.

National security adviser Jake Sullivan, National Economic Council Director Brian Deese and Commerce Secretary Gina Raimondo also attended.

Latest Headlines