U.S. chip industry asks Biden administration to fund factories – 02/11/2021 – Market

A group of US chip companies on Thursday sent a letter to President Joe Biden requesting “substantial funding for semiconductor manufacturing incentives” as part of its economic and infrastructure recovery plans.

Executives from major US companies, including Intel, Qualcomm, Micron Technology and Advanced Micro Devices, signed the letter.

It comes at a time when a global chip shortage has crippled the Ford Motor and General Motors factory lines, with automaker executives predicting billions in lost profits. The tight stock of chips has made it even more difficult for consumers to purchase popular game consoles, such as Microsoft’s Xbox and Sony’s Playstation.

The missing chips are made mostly in countries like Taiwan and South Korea, which have come to dominate the industry. The letter, sent by the Semiconductor Industry Association, said the United States’ share of semiconductor manufacturing had increased from 37 percent in 1990 to 12 percent today.

“This is mainly because the governments of our global competitors are offering significant incentives and subsidies to attract new semiconductor manufacturing facilities, unlike the United States,” the group said.

Congress authorized grants for chipmaking and semiconductor research last year, but lawmakers have yet to decide how much funding to provide. The US chip group urged Biden to provide this funding in the form of donations or tax credits.

“By working with Congress, your administration now has a historic opportunity to fund these initiatives to make them a reality,” the group wrote. “We believe bold action is needed to address the challenges we face. The costs of inaction are high.

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