Though the impact won’t be felt immediately, President Joe Biden answered urgent pleas from the automotive industry and other groups last week by directing a review of potential weaknesses in U.S. supply chains in an effort to address the global semiconductor chip shortage that has forced automakers to cut back vehicle production.
Biden’s executive order launched an immediate 100-day review of supply chains for four vital products — semiconductor chips, large-capacity batteries for electric vehicles, critical minerals and strategic materials such as rare-earth elements, and pharmaceuticals. It also calls for an in-depth review of six industrial sectors including transportation, energy and information and communications technology within one year.
The action is a first step by the administration to comprehensively identify risks in the nation’s critical supply chains and part of Biden’s commitment to accelerate U.S. leadership in clean energy by potentially expanding domestic production of those items.
In the short term, however, the president’s directive “will probably not assist that much” in getting the needed semiconductors into vehicles, said Ann Wilson, senior vice president of government affairs at the Motor & Equipment Manufacturers Association.
“Longer term, though, it gives us the opportunity to address the core reasons we have this crisis right now to make sure that we don’t repeat history,” she told Automotive News.
Industry groups including MEMA urged Biden last month to work with Congress to provide “robust funding” to incentivize the construction of semiconductor manufacturing plants in the U.S and invest in research capabilities.
A bipartisan group of eight governors from states including Michigan, Ohio and Kentucky also called on Biden to redouble efforts to help secure sufficient semiconductor supply to meet demand from the auto industry, according to a letter sent to the White House on Friday, Feb. 26.
