Semiconductor Makers and Users Form a Group to Push for Chip Funding

Semiconductor companies and large companies that use chips have joined forces in a coalition to raise tens of billions of dollars in federal funding for semiconductor research and manufacture in the United States.

The new group, the Semiconductors in America Coalition, announced its formation Tuesday in the face of a global semiconductor shortage that has disrupted the entire economy. Its members include chip manufacturers such as Intel, Nvidia and Qualcomm as well as companies that rely on semiconductors such as Amazon Web Services, Apple, AT&T, Google, Microsoft and Verizon.

The coalition is calling on Congress to allocate $ 50 billion to research and manufacture semiconductors, which President Biden proposed as part of his $ 2.3 trillion infrastructure package.

“Executives from a wide range of critical sectors of the US economy, as well as a large and non-partisan group of policymakers in Washington recognize the essential role of semiconductors in America’s present and future strength,” said John Neuffer, president and CEO of the Semiconductor Industry Association , a trading group.

In a letter to the leaders of Congress, the new coalition noted the shortage of semiconductors and said that in the long run, federal funding would “help America build the extra capacity it needs to have more resilient supply chains to ensure that.” critical technologies are in place when we need them. “

The shortage is being felt acutely in the auto industry and is forcing automakers to shut down their plants. Ford Motor announced last month that the shortage would cut vehicle production by about 50 percent in the second quarter and cut the company’s profits by about $ 2.5 billion this year.

The new coalition does not include automakers who have their own ideas on how the government should promote domestic semiconductor manufacturing. In a letter to Congress leaders last week, groups representing automakers, auto suppliers and auto workers expressed support for Mr Biden’s $ 50 billion proposal, but stressed the need to increase chip manufacturing capacity in automotive quality as part of efforts to increase.

The letters from the American Automotive Policy Council, the Motor & Equipment Manufacturers Association, and the United Auto Workers Union suggested “allocating specific funding to semiconductor equipment that commit to using some of their capacity to manufacture chips for automobiles” .

In a letter to congressional leaders last month, technology trading groups opposed the provision of new manufacturing capacity for a particular industry, saying that such a move would mean “unprecedented market disruption.”

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