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Tech Giants Urge Congress to Fund Chip Act, Focus on Long-Term

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(Bloomberg) -- Apple Inc., Microsoft Corp. and other large technology companies added their voices to the chip industry’s calls for U.S. lawmakers to provide $50 billion in funding for legislation aimed at boosting domestic semiconductor production.

The Semiconductors in America Coalition, which also includes Alphabet Inc.’s Google, Cisco Systems Inc., Amazon.com Inc.’s Amazon Web Services, Verizon Communications Inc. and AT&T Inc., is sending letters to Congressional leaders asking them to fund the CHIPS for America Act passed earlier this year, according to a statement from the Semiconductor Industry Association, which is a member. Public money would go to provide incentives for manufacturing and research in the U.S.

Semiconductor production and plant locations have increasingly come into focus amid shortages that have hurt shipments of everything from iPhones to pickup trucks, caused by spikes in demand as parts of the economy recover from the depths of the pandemic. The U.S. is home to companies that dominate the chip industry’s revenue, while the majority of manufacturing of the crucial electronic components is done in Asia.

Technology companies want the government to partially foot the bill for stemming a slide in U.S. production, which has seen its share of the market drop to 12% from 37% in 1990, according to the SIA. But they don’t want government to step in to mandate where more immediate chip supply is channeled. Automakers, who weren’t mentioned as members of the coalition in SIAC’s release, have lobbied to have semiconductor output assigned to their needs to help return their plants back to full production.

“The current shortage of semiconductors is impacting a broad range of industries throughout the economy. To address this problem in the short term, government should refrain from intervening as industry works to correct the current supply-demand imbalance causing the shortage,” the new organization said in the statement provided by the SIA. “But for the longer term, robust funding of the CHIPS Act would help America build the additional capacity necessary to have more resilient supply chains to ensure critical technologies will be there when we need them.”

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