Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON
News: Latest News
Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesBusiness LeadersFinance Pro.CalendarSectors 
All NewsEconomyCurrencies & ForexEconomic EventsCryptocurrenciesCybersecurityPress Releases

Automakers, medical device firms ask Biden for U.S. chip factory subsidies

02/18/2021 | 06:14am EDT
FILE PHOTO: A researcher plants a semiconductor on an interface board during a research work to design and develop a semiconductor product at Tsinghua Unigroup research centre in Beijing

(Reuters) - More than a dozen business groups representing automakers, medical device makers and manufacturers sent a letter to President Joe Biden on Thursday calling on him to work with U.S. lawmakers to provide federal funding for the construction of new chip factories.

The groups, which include the U.S. Chamber of Commerce as well as industry-specific associations representing General Motors Co, Caterpillar Inc and Medtronic PLC, among others, sent the letter as a shortage of semiconductors continues to disrupt U.S. automobile factories and threatens to lower the automakers' profits by billions of dollars.

A group of chipmakers last week sent a similar letter. Congress authorized programs last year to provide subsides for chip research and factory construction, but U.S. lawmakers still need to provide specific funding for the program.

"To be competitive and strengthen the resilience of critical supply chains, we believe the U.S. needs to incentivize the construction of new and modernized semiconductor manufacturing facilities and invest in research capabilities," the business groups wrote in their letter on Thursday.

The majority of chip production, especially for advanced computing chips, now occurs in Asia, where major contract manufacturers such as Taiwan Semiconductor Manufacturing Co Ltd (TSMC) and Samsung Electronics Co Ltd handle production for hundreds of different chip companies. Both TSMC and Samsung are planning new U.S. chip factories in the next few years that could benefit from the program if it is funded.

In addition to funding existing programs, the business groups also called for an "investment tax credit" that could help defray the cost of semiconductor manufacturing tools, which can cost billions of dollars for new factories and typically far outstrip the cost of buildings.

American toolmakers such as Applied Materials Inc, Lam Research Corp and KLA-Tencor Corp dominate the industry, though Netherlands-based ASML Holding NV and Japan's Tokyo Electron Ltd are also major players in some segments.

(Reporting by Stephen Nellis in San Francisco; Editing by Christopher Cushing)

By Stephen Nellis


© Reuters 2021
Stocks mentioned in the article
ChangeLast1st jan.
APPLIED MATERIALS, INC. -1.76% 128.59 Delayed Quote.49.00%
ASML HOLDING N.V. 3.46% 529.3 Real-time Quote.28.79%
CATERPILLAR INC. -2.05% 227.63 Delayed Quote.27.67%
GENERAL MOTORS COMPANY -3.65% 55.77 Delayed Quote.33.93%
INTEL CORPORATION -1.46% 62.7 Delayed Quote.27.72%
KLA CORPORATION -1.69% 318.92 Delayed Quote.23.18%
LAM RESEARCH CORPORATION -1.40% 613.03 Delayed Quote.29.81%
MEDTRONIC PLC 1.70% 128.28 Delayed Quote.7.67%
MSCI TAIWAN (STRD, UHD) 0.64% 704.414 Real-time Quote.16.47%
SAMSUNG ELECTRONICS CO., LTD. 0.72% 83900 End-of-day quote.3.58%
TAIWAN SEMICONDUCTOR CO., LTD. 1.60% 57.2 End-of-day quote.-8.04%
TAIWAN SEMICONDUCTOR MANUFACTURING COMPANY LIMITED -0.17% 602 End-of-day quote.13.58%
TOKYO ELECTRON LIMITED -2.30% 48900 End-of-day quote.27.34%
Latest news "Economy & Forex"
09:18aWall St set for lower open as Netflix slides, cases rise
RE
09:14aDish gets Amazon on board to build 5G network, to launch in Las Vegas
RE
09:14aAXONIUS  : Secures Contract to Support DHS CDM for Group F Federal Agencies
BU
09:08aSaudi tadawul group shortlists saudi national bank, saudi fransi capital and hsbc saudi arabia among local banks -sources
RE
09:07aSaudi tadawul group shortlists citigroup, morgan stanley and jpmorgan for potential roles in ipo -sources
RE
09:07aRussia's Putin, with election looming, sets out new social support measures
RE
09:07aTexas on track to add record solar power capacity by end of 2022
RE
09:07aCybersecurity Pioneer Cyemptive Technologies Announces Speakers for Its Upcoming Webinar on How to Build a More Compliant and Cyber-safe Business Environment
BU
09:06aOil prices drop as India's COVID-19 surge dents demand outlook
RE
09:05aAirline body iata forecasts 2021 global air traffic at 43% of pre-crisis level vs. 51% forecast in december
RE
Latest news "Economy & Forex"