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szdaily -> World Economy -> 
US automakers plead for govt. help in growing chip crisis
    2021-01-18  08:53    Shenzhen Daily

U.S. automakers are asking the U.S. Government to help solve a shortage of computer chips that is closing auto factories worldwide and could restrict production until the fall.

The American Automotive Policy Council (AAPC) — a lobbying organization for General Motors Co., Ford Motor Co. and the U.S. operations of Fiat Chrysler Automobiles NV — is agitating with the U.S. Commerce Department and the incoming administration of President-elect Joe Biden to press Asian semiconductor makers to reallocate output away from consumer electronics and build essential chips for cars.

“We have requested that the U.S. Government help us find a solution to the problem because it will diminish our production and have a negative impact on the U.S. economy until it’s resolved,” Matt Blunt, president of the AAPC, said in an interview Friday. “We are not primarily concerned with where blame may lie for this global shortage, if it lies anywhere, but we just want a solution. And the solution is more automobile-sector semiconductors.”

The shortage forced Ford to shut a sport-utility vehicle factory in Kentucky last week, and it is closing a small-car plant in Germany for a month. Fiat Chrysler has had to temporarily stop output at plants in Mexico and Canada.

Volkswagen and its subsidiary Audi said Thursday they would temporarily cut production and furlough workers as a result of a shortage of computer chips.

Volkswagen is sending roughly 8,800 employees at its plant in Emden, northern Germany, into short-time work, the carmaker said. Luxury subsidiary Audi meanwhile is placing 10,000 employees on reduced hours until the end of January in Ingolstadt and Neckarsulm, both in the south of the country, the company said.

More production is expected to be idled in the coming weeks.

Fingers of blame have been pointing in both directions, with chipmakers saying the auto industry brought this shortage on itself by reduced orders too sharply when the pandemic hit last year. Automakers and their suppliers, though, point to the chipmakers prioritizing consumer electronics because margins are fatter on those devices and demand for them boomed as more people stayed home during virus-related shutdowns.

The more the dispute drags on, the more it will hurt the U.S. economy, Blunt said. Since it takes chip manufacturers at least three months to ramp up production, the affect on auto factories will linger deep into 2021.

“Even if you solve this today, you’d have an entire quarter that’s going to be impacted,” Blunt said.

Blunt, the former Republican governor of Missouri, said he has begun “nascent” discussions with the Biden administration, which he hopes will put the chip shortage near the top of its to-do list.

“There are lots of people in the incoming administration that have some automobile experience and expertise, and certainly lots of folks understand, including the president-elect, how important the industry is to the United States,” Blunt said. “So we’re hopeful it will be a priority for them to help us resolve as soon as the president is inaugurated.”(SD-Agencies)

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