But exactly how to spend and allocate the semiconductor funding is a source of debate among automakers and other consumers of chips, as well as the semiconductor companies themselves.
Carmakers are pushing for a portion of the money to be reserved for vehicle-grade chips, warning of a potential 1.3 million shortfall in car and light-duty truck production in the U.S. this year if their industry isn’t given priority.
Yet makers of other electronic devices affected by the chip shortage, such as computers and mobile phones, have taken issue with the carmakers’ demands, worried their industries will suffer. The debate could be a factor in the White House meeting.
The White House has not taken a public position on the issue but has indicated privately to semiconductor industry leaders that it would not support special treatment for one industry, according to people familiar with the matter.
Matt Blunt, president of the American Automotive Policy Council, which lobbies for Ford, GM and Stellantis, expressed optimism that the Biden administration would at least consider his industry’s arguments.
He said the White House has not endorsed any specific plans for setting aside money for carmakers, but administration officials “understand why the proposal was made.”
“We hope in the meeting, whoever is gathered there will get an understanding of how we get to where we are fulfilling 100% of orders and provide a road map of what that looks like,” he said.
To avoid future chip shortages, Blunt’s group proposed that at least 25 percent of any federal support for the construction of semiconductor factories must go to U.S. facilities that commit to allocating at least 25 percent of their capacity to automotive-grade chips.
John Neuffer, CEO of the Semiconductor Industry Association, said the industry understands “the difficulty the auto sector is feeling right now, and chipmakers are working hard to ramp up production to meet demand in the short term.”
For the long term, he said, the industry needs a boost in domestic production and innovation across the board “so all sectors of our economy have access to the chips they need, and that requires swiftly enacting federal investments in semiconductor manufacturing and research.”
