Analysts say one big reason car prices are high and supply chains are massively delayed is that there are not enough semiconductor chips, made in America.
But President Biden signed into law, the new Bipartisan Chips Act.
The Chips Acts invests more than $200-billion over the next 5 years to help America regain a top role in making semiconductors. Investing more than 50 billion dollars in American companies that make computer chips and encourage
the innovation of other technology.
At the moment Taiwan produces most of them.
But with the growing threat of military conflict between Taiwan, and mainland China the Pentagon says it’s essential to make more chips, here.
“Taiwan itself is you know, among the most impactful economic entities on planet Earth, and they provide something like 70 to 90% of the most advanced semiconductors that everybody’s iPhone and laptops and everything else runs on.”
Biden says the new law invests in America itself bringing down costs and creating new jobs.
One of the industries suffering from the shortage is the auto industry.
Dealerships say the lack of chip availability is hurting vehicle production.
One local car dealership manager told me, it makes his and many other car dealerships feel more at ease with their supply and demand.
John Kiser is the car manager Memorial Highway Chevrolet, “Yes, everybody in the car business knows everyone if you’ve been doing this long enough. And we all talk on a consistent basis whether its Dodge, whether its Ford, Chevy, Cadillac, were all in the same boat.”
Kiser says that many car dealership managers in the area agree the chip shortage is hurting their businesses.
Kiser adds, “The biggest problem is getting them over here. It slows down production of the vehicles and leaves us shortage of the new cars that we usually have. From usually having fifty on the lot, now were down to twenty, twenty-five which almost cuts our inventory half or below.”
Senator Bob Casey says the new law will make America more competitive overall on the world stage.
“We’ve really lost our edge when it comes to our production of semiconductors. We used to produce more than a third as high as thirty seven percent of the worlds semiconductors. That thirty seven percent is down to twelve. Just twelve percent.”
Chips are a necessary tool found not just in cars, but in washing and drying machines, as well as smart phones.
Kiser tells me the shortage begin during the coronavirus pandemic when the country faced a major standstill with no one working and nothing being produced.
With the chips and science act being signed, the united states will focus on producing their own chips for all kinds of technology.
Kiser included, “And the biggest thing, the chips will be built here. So we will not be dependent on another country that send us these chips. So, they will be manufactured here put in our cars here so we can get into our cars faster.”