Big Tech, semiconductors team up to lobby US government on chip production funding

Group seeks to bolster US manufacturing of semiconductors

Big Tech and top chipmakers have formed a new lobbying group that is seeking government chip manufacturing subsidies. 

The Semiconductor in America Coalition, made up of chip buyers including Amazon Web Services, Apple, Google and Microsoft, and manufacturers like American Micro Devices, Intel, Nvidia and Texas Instruments, has asked Congress to provide funding for the CHIPS for America Act, which authorized domestic chip manufacturing incentives and research initiatives. 

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President Biden has previously asked Congress to provide $50 billion of federal money. 

"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 congressional leaders. 

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Chip supply chains were disrupted due to production shutdowns that were implemented to help slow the spread of COVID-19. 

The resulting global chip shortage has caused auto manufacturers to slash production. Automakers have asked Biden to use the Defense Production Act to reallocate chips to the sector, but the administration has balked at the request amid concerns doing so would cause other industries to face a shortfall. 

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The share of chips manufactured in the U.S. has fallen from 37% in 1990 to 12% today, according to the Semiconductor Industry Association, which says the decline is mostly due to subsidies offered by foreign governments to global competitors, putting American companies at a disadvantage. 

Commerce Secretary Gina Raimondo will hold a summit on May 20 with companies impacted by the global chip shortage, according to a report from Bloomberg News.