America’s Semiconductor Industry Association (SIA) has hailed President Joe Biden’s Executive Order calling for a review of supply chains and critical products, including semiconductors.

President Biden is also asking for US$37bn to bolster American supply chains as the semiconductor pinch continues to affect manufacturers worldwide.

The issue has garnered bipartisan support in the US, with Senate Auto Caucus co-chairman, Rob Portman (R-OH), along with many other politicians, recently writing to National Economic Council director, Brian Deese, urging him to work with Congress in addressing the global semiconductor shortage facing vehicle manufacturing.  

Some reports indicate the lack of chips could last for as long as six months, while others estimate volume losses of vehicles to be potentially around 200,000

“We welcome [the] Executive Order and stand ready to work with the Biden administration to ensure the strength and resilience of America’s semiconductor supply chains,” said SIA board chairman, Bob Bruggeworth.

“As part of this effort, we urge the President and Congress to invest ambitiously in domestic chip manufacturing and research. Doing so will ensure more of the chips our country needs are produced on US shores, while also promoting sustained US leadership in the technology at the heart of America’s economic strength and job creation, national security and critical infrastructure.”

The SIA says the share of global semiconductor manufacturing capacity in the US has decreased from 37% in 1990 to 12% today. This decline, maintains the Association, is “largely due to substantial subsidies offered by the governments of our global competitors,” which have placed the US at a competitive disadvantage in attracting new construction of semiconductor manufacturing facilities.

Additionally, adds the SIA, Federal investment in semiconductor research has been flat as a share of GDP, while other governments have invested substantially in research initiatives to strengthen their own semiconductor capabilities.

The SIA notes Congress recently enacted the CHIPS for America Act as part of the FY 2021 National Defense Authorization Act (NDAA).

The new law calls for incentives for domestic semiconductor manufacturing and investments in chip research, but funding for these provisions must come through congressional appropriations.