White House Steps Up Efforts to Address Automotive Chip Shortage

A close-up of the Infineon XMC 4700 microcontroller kit is displayed at an exhibition during the annual shareholders meeting of the German semiconductor manufacturer Infineon in Munich, on February 21, 2019.

Andreas Gebert | Reuters

Top White House national security and economic officials have stepped up efforts to help the US auto industry combat a growing shortage of semiconductor chips that has forced production cuts around the world, a White House spokeswoman said. .

President Joe Biden’s administration has held meetings with automotive companies and suppliers to identify bottlenecks and urged companies to work cooperatively to address the shortage, the spokeswoman said Wednesday.

The White House has also tasked the US embassies with identifying how foreign countries and companies that produce chips can help solve global shortages and work with international partners and allies, urging them to deal with the current shortages.

The effort includes an outreach to Taiwan, home of key chipmaker Taiwan Semiconductor Manufacturing Co (TSMC), to find ways to solve the shortage.

In a February 17 letter, Biden’s top economic adviser Brian Deese thanked Taiwan’s Minister of Economic Affairs Wang Mei-hua for working to help solve the shortage in coordination with the island’s manufacturers.

Along with Deese, White House National Security Advisor Jake Sullivan is involved in the effort, as are other senior aides.

This month, US officials held a meeting with Wang in which the United States thanked Taiwan for its help in solving the shortage of auto chips, he said.

The White House spokeswoman said officials acknowledge that steps must be taken to prevent shortages in the future, so the administration is launching a comprehensive review of critical supply chains to identify vulnerabilities and take steps such as stimulating increased national production of the United States.

General Motors said on February 9 that a global chip shortage could cut as much as $ 2 billion from 2021 profits and extended production cuts at three North American plants. It also said it would partially build and then finish assembling vehicles at two other factories due to chip shortages.

The second largest US automaker, Ford Motor, warned this month that chip shortages could lead to a 10% to 20% loss in first-quarter production, resulting in a potential impact on earnings. operating from $ 1 billion to $ 2.5 billion. He said he lost some of the production of his best-selling F-150 pickup truck.

The auto chip shortage could affect nearly 1 million units of global light vehicle production in the first quarter, data firm IHS Markit said on Tuesday, adding that it still expects most of the volume to recover in the rest of 2021.

In a January 19 letter to Deese first reported by Reuters, the United Auto Workers union and auto trade groups asked the Biden administration to consider “urging major silicon wafer foundries to increase production of automotive grade wafers. “

The chip shortage has hit many other automakers, including Toyota Motor, Volkswagen, Stellantis, Renault, Subaru, Nissan Motor, Honda Motor, and Mazda Motor.


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