- The Washington Times - Monday, April 12, 2021

President Biden said Monday that semiconductor chips constitute “infrastructure” that the U.S. needs to invest in to compete with China, as major automakers and other companies struggle to deal with a devastating shortage of imported chips.

“These chips, these wafers … batteries, broadband — it’s all infrastructure. This is infrastructure,” Mr. Biden said as he held up a silicon wafer. “So look, we need to build the infrastructure of today, not repair the one of yesterday.”

Mr. Biden was speaking from the White House with titans of industry who gathered virtually to talk about supply chain issues with semiconductor chips, which are used in a variety of things, including coffee makers, cellphones and automobiles.

“For too long as a nation, we haven’t been making the big, bold investments we need to outpace our global competitors,” the president said. “We’ve been falling behind on research and development and manufacturing. And put it bluntly — we have to step up our game.”

The U.S. share of global semiconductor production capacity has fallen to 12% from 37% in 1990, according to the Semiconductor Industry Association.

Automakers and other companies have been grappling with a shortage of chips. General Motors, Ford and Subaru have idled their plants recently because of the shortage.

Demand for the auto chips plunged during the coronavirus pandemic but rebounded much more quickly than anticipated.

The president said he’s ready to work with both parties to pass his $2.3 trillion infrastructure package, which includes spending to boost U.S. production of semiconductor chips.

“I’m not ready to give up — I’m ready to work with all of you, with the Congress, both parties, to pass the American Jobs Plan and to make a once-in-a-generation investment in America’s future,” Mr. Biden said.

As part of the plan, the president is calling on Congress to authorize $50 billion for semiconductor manufacturing and research, mirroring bipartisan legislation lawmakers introduced last year.

Mr. Biden also wants some of the $50 billion his plan directs to the National Science Foundation to focus on fields such as semiconductors and advanced computing.

But industry experts warn that there’s not much that can be done quickly.

“This could change things over the next three to five years, but for right now, there’s no structural changes that could alleviate the shortage,” said Wedbush analyst Daniel Ives.

Business leaders scheduled to be in attendance at the White House event included GM Chairman and CEO Mary Barra, Ford Motor Co. President and CEO Jim Farley Jr., Alphabet and Google CEO Sundar Pichai, and Northrop Grumman Chairman, CEO and President Kathy J. Warden.

Other members of the administration scheduled to be in the meeting included National Security Adviser Jake Sullivan, National Economic Council Director Brian Deese and Commerce Secretary Gina Raimondo.

John Neuffer, president and CEO of the Semiconductor Industry Association, said he appreciated Mr. Biden’s attention to the issue.

“Today’s meeting marks the continuation of a strong partnership between the Biden administration and industry to strengthen America’s semiconductor supply chain by enacting federal investments in domestic chip manufacturing and research,” Mr. Neuffer said.

This article is based in part on wire service reports.

• David Sherfinski can be reached at dsherfinski@washingtontimes.com.

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