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US automakers count on government aid to tackle chip shortages
American automakers, like their competitors around the world, at the end of last year faced a shortage of semiconductor components, which forced some of them to stop production lines and postpone the launch of new models. In the fight against the shortage of chips, American companies rely on the administrative resource of the United States and have already turned to the authorities for help.
Image source: Bloomberg
The American Automotive Policy Council has taken the initiative on behalf of General Motors, Ford Motor and Fiat Chrysler, Bloomberg reports. She is going to negotiate with the US Department of Commerce and the administration of President Biden to pressure Asian contractors to reallocate production priorities in favor of the needs of the American auto industry. As you know, automakers began to suffer from a shortage of semiconductor components after the main part of the last year the car market showed sluggish demand, and by the end of the year began to grow sharply. Chip manufacturers simply did not have time to respond to this trend in time, and a sufficiently long production cycle – at least 90 days – does not allow to cover the market demand instantly.
The organization lobbying the interests of American industrialists claims that it is not interested in the reasons for the deficit, it is only looking for state support in solving the problem itself. Even if the manufacturing deficit is addressed now, the situation will not improve until mid-year as the supply chain will not recover immediately. If measures are delayed, the deficit could persist until the third quarter, exacerbating the position of automakers. Senators of the United States also joined in lobbying the interests of American automakers. They expect the country’s new president to prioritize semiconductor shortages after taking office later this month. Tellingly, his predecessor largely contributed to the emergence of this deficit by imposing sanctions against Chinese companies, the redistribution of orders of which affected the activities of TSMC, SMIC, and GlobalFoundries.