Automakers and medical device companies are asking Biden for subsidies for the US chip factory

More More than a dozen commercial groups representing automakers, medical device manufacturers and manufacturers sent a letter to President Joe Biden Thursday asking him to work with US lawmakers to provide federal funding for building new chip factories.

The groups, which include the United States Chamber of Commerce and industry-specific associations representing, among others, General Motors Co, Caterpillar Inc, and Medtronic PLC, sent the letter as the semiconductor shortage continues to disrupt U.S. auto factories and threatens to drop carmakers’ profits by billions of dollars. A group of chip makers sent out a similar letter last week. Congress last year authorized programs to provide subsidies for chip research and factory construction, but US lawmakers have yet to provide specific funding for the program.

“To be competitive and strengthen the resilience of critical supply chains, we believe the US must incentivize the construction of new and modernized semiconductor manufacturing facilities and invest in research capabilities,” the business groups wrote in their letter Thursday. Most of the chip manufacturing, especially for advanced processing chips, now takes place in Asia, where major contract manufacturers such as Taiwan Semiconductor Manufacturing Co Ltd (TSMC) and Samsung Electronics Co Ltd handle manufacturing for hundreds of different manufacturing companies. chip. Both TSMC and Samsung are planning new chip factories in the United States in the coming years that could benefit from them from the program if it is funded.

In addition to funding existing programs, corporate groups have also applied for an “investment tax credit” that could help defray the cost of semiconductor manufacturing tools, which can cost billions of dollars for new factories and typically exceed by far the cost of buildings. American tool makers such as Applied Materials Inc, Lam Research Corp and KLA-Tencor Corp dominate the industry, although Netherlands-based ASML Holding NV and Japan-based Tokyo Electron Ltd are also major players in some segments.

(This story was not edited by our team of editors and is generated from a feed.)

News Highlights:

  • More More than a dozen commercial groups representing automakers, medical device manufacturers and manufacturers sent a letter to President Joe Biden Thursday asking him to work with US lawmakers to provide federal funding for building new chip factories. The groups, which include the United States Chamber of Commerce and industry-specific associations representing, among others, General Motors Co, Caterpillar Inc, and Medtronic PLC, sent the letter as the semiconductor shortage continues to disrupt U.S. auto factories and threatens to drop carmakers’ profits by billions of dollars.
  • Automakers and medical device companies are asking Biden for subsidies for the US chip factory