(Add possible actions to increase disk supply)
WASHINGTON, Feb. 24 (Reuters) – President Joe Biden on Wednesday will sign an executive order aimed at addressing a global shortage of semiconductor chips that has forced U.S. automakers and other manufacturers to reduce production and the White House and to worry members of Congress. .
The scarcity, exacerbated by the pandemic, will be the topic when Biden meets with a dual group of U.S. lawmakers Wednesday to discuss the matter.
Administration officials said Biden’s executive order, which will be signed Wednesday at 4:45 p.m. EST (2145 GMT), will begin an immediate 100-day review of supply chains for four critical products: semiconductor chips, high-capacity batteries for electrical vehicles, rare earth minerals and pharmaceuticals.
The order will also address six sectoral reviews – based on the process used by the Department of Defense to strengthen the industrial base for defense. It will focus on the areas of defense, public health, communications technology, transportation, energy and food production.
Since the onset of the pandemic, the shortage of supplies has been besieged by the United States, which has hampered the availability of masks, gloves and other personal protective equipment, which has hurt frontline workers.
The scarcity shortage, which in some cases forces carmakers to take workers off their production lines, is the latest example of the supply bottlenecks affecting American workers.
‘Do not make a mistake, we do not just plan to order reports. We plan to take steps to reduce gaps as we identify them, ‘the administration official added.
A group of U.S. chip companies had earlier asked Biden to provide substantial funding for semiconductor manufacturing incentives, as part of its economic recovery and infrastructure plans. Last summer, they backed bipartisan legislation to provide ‘tens of billions of dollars’ to help pay for the production and testing of chips.
The scarcity of chips quickly became a major headache for the White House.
Ford Motor Co. recently said a lack of chips could reduce the company’s production by up to 20% in the first quarter, while General Motors said it was forced to reduce production at factories in the United States, Canada and Mexico. and its production plans in mid-March.
U.S. semiconductor companies account for 47% of global chip sales, but only 12% of production because, according to the Semiconductor Industry Association, they have outsourced much of their manufacturing overseas. In 1990, the United States accounted for 37% of global semiconductor production.
Biden, a Democrat, was under pressure from Republican lawmakers to do more to protect U.S. supply chains from China by investing in the domestic production of next-generation semiconductor chips.
“I urge the Biden government to give priority to protecting emerging and critical technologies, such as semiconductors, from the grip of the CCP (Chinese Communist Party),” said US Representative Michael McCaul in a statement. recent letter to the White House of Republicans written about the House of Representatives. Foreign Affairs Committee.
Under Biden’s command, the White House will seek to diversify the United States’ supply chain dependency on specific products such as scarce earth minerals from China.
The official will try to develop some of the production in the United States and cooperate with other countries in Asia and Latin America.
The review will also look at limiting imports of certain materials and training U.S. workers to increase production at home.
The executive order in the supply chain will increase Biden’s vow in January to harness the purchasing power of the US government, the largest single buyer of goods and services in the world, to strengthen local manufacturing and create markets for new technologies. (Reporting by Nandita Bose and Steve Holland in Washington; Additional Reporting by Alexandra Alper; Editing by Leslie Adler and Jonathan Oatis)