White House seeks to address semiconductor chips crisis harming automakers

September 23, 2021

By David Shepardson

WASHINGTON (Reuters) – The White House will discuss ways to overcome a semiconductor chip supply crisis that is cutting auto production around the world in a new round of meetings with major companies on Thursday.

Commerce Secretary Gina Raimondo and White House National Economic Council director will host companies including Detroit’s Big Three automakers General Motors, Ford Motor and Stellantis as well as Apple, Daimler AG, GlobalFoundries, Micron, Microsoft, Samsung, TSMC and others including Intel Corp Chief Executive Pat Gelsinger.

The White House plans to release a voluntary request for information this week to get better information on the chips problem from industry and potential solutions to supply chain issues.

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 told reporters the Biden administration also plans to stand up a voluntary “early alert system for COVID-19 related shutdowns to microelectronics manufacturing around the world,” gathering information from U.S. embassies, impacted businesses and others.

The administration wants to ensure it is “maximizing our technical and material assistance to these locations to keep key semiconductor manufacturing facilities and other important facilities up and running.”

Rising COVID-19 infections have slowed output at parts factories in Vietnam and Malaysia, compounding a global shortage of auto chips.

Last month, the economy minister for Taiwan, a major chip maker, said it was doing all it can to address the global shortage of semiconductors.

The issue has taken on a strong diplomatic hue as Taiwan scrambles to reassure the United States, its most important international supporter and arms supplier, that it is doing all it can, especially at a time when Taipei is facing increased military pressure from China, which views Taiwan as its own.

Last week, data firm IHS Markit said semiconductor shortages and delayed packaging and testing of chips will cause production of global light vehicles to drop by five million this year. Some automakers think the crisis may last until late 2022 or into 2023.

Automakers from GM to Toyota Motor Corp have slashed output and sales forecasts due to scarce chip supplies, made worse by a COVID-19 resurgence in key Asian semiconductor production hubs.

GM earlier this month cut production at most of its North American production.

Other companies attending Thursday including AMD, Applied Materials, Medtronic and Siemens.

The White House wants Congress to approve $52 billion to boost U.S. production of semiconductor chips.

(Reporting by David Shepardson; additional reporting by Alex Alper; Editing by Simon Cameron-Moore)

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