Tech giants join call for funding US chip production

Platform News: Tech Titans including Facebook, Google, Amazon and Apple

Some of the world’s biggest chip buyers, including Apple, Microsoft and Google, are joining top chip-makers such as Intel Corp to create a new lobbying group to press for government chip manufacturing subsidies.

The newly formed Semiconductors in America Coalition, which also includes Amazon.com’s AWS, has said it has asked US lawmakers to provide funding for the CHIPS for America Act, for which President Biden has asked Congress to provide $50 billion.

“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,” the group said in a letter to Democratic and Republican leaders in both houses of the US Congress.

A global chip shortage has hit automakers hard, with Ford Motor Co saying it could halve second-quarter production.

Automotive industry groups have pressed the Biden administration to secure chip supply for car factories. But last week we reported officials from the administration were reluctant to use a national security law to redirect computer chips to automakers because doing so could hurt other industries.

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The new coalition includes some of those other chip-consuming industries, with members such as AT&T, Cisco Systems, General Electric, Hewlett Packard Enterprise and Verizon Communications. It cautioned against government actions to favour a single industry such as automakers.

“Government should refrain from intervening as industry works to correct the current supply-demand imbalance causing the shortage,” the group said.

Tech companies such as Apple are also being hit by the chip shortage, but far less severely than leading manufacturers in the automotive sector.

The iPhone maker said last month it will lose $3 billion to $4 billion in sales in the current quarter ending in June because of the chip shortage, but that equates to just a few percent of the $72.9 billion in sales analyst expect for Apple’s fiscal third quarter, according to Refinitiv revenue estimates.

The team at Platform Executive hope you have enjoyed this article. Automatic translation from English to a growing list of languages via Google AI Cloud Translation. Initial reporting via our official content partners at Thomson Reuters. Reporting by Stephen Nellis in San Francisco. Editing by Richard Pull.

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