GOVERNMENT

Upton, Meijer send letter to House leadership urging action on semiconductor shortage

Arpan Lobo
The Holland Sentinel

HOLLAND — A bipartisan group of lawmakers is urging House leadership to take action on a bill which would prompt emergency spending on domestic semiconductor production. 

Lawmakers, including Reps. Fred Upton, R-St. Joseph, and Peter Meijer, R-Grand Rapids, sent House Speaker Nancy Pelosi and House Minority Leader Kevin McCarthy a letter Thursday urging the hearing of the Creating Helpful Incentives to Produce Semiconductors for America, or CHIPS Act.

The CHIPS Act would fund incentive programs for manufacturers to create more semiconductor chips, which are used in the production of cars. Semiconductors are used for features like touchscreens, navigation systems and other driver assistance tools.

More:The microchip shortage explained: How it's impacting car prices and the tech industry

Supply chain disruptions caused by the coronavirus pandemic have led to a shortage in the chips, resulting in lower supply for new cars. It's placed strain on auto manufacturers and led to job loss and the shutdown of car production lines. 

Representatives are hopeful to accelerate the CHIPS Act potential passage and provide a boost to manufacturers, as well as help with inflation concerns for those in the U.S. looking to buy a new car. 

"While the U.S. is a world leader in semiconductor design, domestic production of semiconductors has declined, and we are reliant on East Asia for manufacturing semiconductors," lawmakers wrote.

"Even before the pandemic began, price volatility led to constraints on raw materials of semiconductors, which have only been exacerbated. In order to save jobs and ensure there is a robust domestic automotive manufacturing industry in the U.S., there must be a significant investment in production of legacy chips."

Rep. Dan Kildee, D-Flint, led lawmakers in sending leadership the letter. The CHIPS Act was included in the Senate-passed defense spending bill, which passed last month.

— Contact reporter Arpan Lobo at alobo@hollandsentinel.com. Follow him on Twitter @arpanlobo.