Apple, Google, and others lobby US Congress for $50 billion chip manufacturing subsidies amid global shortage
Tech industry heavyweights including Apple, Microsoft, Alphabet, Amazon, and more are forming a coalition to lobby the US government to fund additional production capacity for chip fabrication. The “Semiconductors in America Coalition” is backing the CHIPS for America Act, in which President...
Tech industry heavyweights including Apple, Microsoft, Alphabet, Amazon, and more are forming a coalition to lobby the US government to fund additional production capacity for chip fabrication. The “Semiconductors in America Coalition” is backing the CHIPS for America Act, in which President Biden is requesting Congress fund for $50 billion.
The money will be used to build out additional chip manufacturing capacity in the United States. The main casualty of the global chip shortage is carmakers like Ford, but Apple admitted on its last earnings call that supply of some MacBook and iPad models will be affected too.
The coalition includes tech giants like Apple, infrastructure companies including AT&T and Verizon, semiconductor firms like Intel, among others.
Groups representing car manufactures like Ford have asked the administration to secure chip supply just for their factories to ensure a steady stream of car production for the foreseeable future. The Semiconductors in America Coalition stresses that government action should not favor a single industry.
As part of its last quarterly earnings call, Apple said that the chip shortages are impacting supply of Macs and iPads. In Apple’s case, it says the bottleneck is in “legacy nodes.” Having already used up its available spare inventory in the first three months of the year, these supply constraints will impair Apple’s ability to make enough devices in the current quarter. Apple said it is “supply gated, not demand gated.” So far, iPhone production is unaffected, but a separate report from Nikkei has indicated that supplies of downstream parts are tight.
Analysts currently believe that the global chip shortage will persist well into 2022. The shortage has arisen due to a perfect storm of factors including droughts, US/China trade wars, fluctuating demand schedules over the last year, and the COVID-19 pandemic.
