US President Joe Biden’s administration is assessing immediate steps to address the semiconductor shortage and plans an executive order to shore up critical supply chain items, a White House spokeswoman said on Thursday.
“The administration is currently identifying potential choke points in the supply chain and actively working alongside key stakeholders in industry and with our trading partners to do more now,” White House spokeswoman Jen Psaki said at a daily briefing.
Psaki said the semiconductor supply shortage is also an impetus for an executive order to commission a “comprehensive review of supply chains for critical goods” that can guide both short-and long-term actions.
“The review will be focused on identifying the immediate actions we can take, from improving the physical production of those items in the US to working with allies, to developing a coordinated response to the weaknesses and bottlenecks that are hurting American workers,” Psaki said.
Automakers have been especially hard hit by the supply crunch for semiconductors, which stems in part from outsized demand for personal electronics during the pandemic.
In the past week, both Ford Motor Co and General Motors Co have been among the carmakers that have signaled an expected earnings hit of at least US$1 billion each for this year due to curtailed car output.
GM has temporarily shuttered three plants through mid-March, while Ford said it was trimming production of its top-selling F-150 truck.
The Semiconductor Industry Association on Thursday called for Biden to include “substantial funding” for semiconductor manufacturing and research in the administration’s economic recovery and infrastructure plan.
The chief executives of major US firms such as Intel Corp, Qualcomm Inc, Micron Technology Inc and Advanced Micro Devices Inc signed onto the letter.
The missing chips are mostly manufactured in countries such as Taiwan and South Korea, which have come to dominate the industry. The letter said that the US share of semiconductor manufacturing dropped from 37 percent in 1990 to 12 percent today.
“This is largely because the governments of our global competitors offer significant incentives and subsidies to attract new semiconductor manufacturing facilities, while the US does not,” the group said.
The supply crunch on semiconductors has also raised questions about the adequacy of other critical items, such as electric battery cells that will be needed to enable a ramp-up in electric auto production touted by US automakers and the Biden administration.
Separately, the Biden administration asked a US court on Thursday to suspend litigation connected to former president Donald Trump’s proposed ban on WeChat (微信) while it reviews the policy.
The Justice Department filed a request with the US Court of Appeals seeking a suspension of the case. That follows action on Wednesday when the department asked a federal court for a pause on proceedings aimed at banning TikTok.
Newly-installed Commerce Department officials have begun a review of the prior administration’s actions on WeChat, including “an evaluation of the underlying record justifying those prohibitions,” the Justice Department said in the filing.
“The government will then be better positioned to determine” whether “the regulatory purpose of protecting the security of Americans and their data, continue to warrant the identified prohibitions,” the filing added.
Trump issued an executive order in August last year declaring both WeChat and TikTok threats to national security because of data collection practices affecting Americans.
The Justice Department said the Commerce Department “remains committed to a robust defense of national security as well as ensuring the viability of our economy and preserving individual rights and data.”
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