A massive semiconductor chip shortage has led to an estimated $210 billion in lost sales in the automotive industry alone this year as carmakers struggle to meet the needs of consumers. Just yesterday, Toyota announced that the month of October saw a 26% drop in production compared with last year, leading to 20% fewer global sales. It’s something that’s clearly on the mind of U.S. Commerce Secretary Gina Raimondo, who believes the country is at an “inflection point” when it comes to boosting semiconductor production in the U.S. as the Biden administration also pushes for a goal of 50% of new cars being manufactured in the country to be electric vehicles by 2030.
Raimondo spoke with reporters ahead of a series of events she attended in Detroit on Monday, including a roundtable with lawmakers at UAW Region 1A headquarters. “We're at an inflection point and we have to make choices," Raimondo said. "If we're serious about restoring American leadership in the global economy, we have to start by rebuilding our semiconductor industry so we can meet the demands of this moment.”
Producing semiconductor chips, Raimondo said, is “necessary for our American economic competitiveness, it's necessary if we're going to meet our climate change goals, and it's necessary to create jobs.” One way to get there is by passing the CHIPS Act, a bill that allocates $52 billion to boost the domestic semiconductor manufacturing sector. Introduced last year, the bill was passed by the Senate in June but has yet to be taken up by the House.
Electric vehicles require significantly more semiconductor chips than their gas-guzzling counterparts. Whereas an average gas-powered car can have between 50 and 150 chips, some EVs contain thousands of chips. According to nonprofit clean vehicle consortium CALSTART, up to 70% of an electric car’s components may be different from a gas-powered car’s. Raimondo also noted that having self-reliance when it comes to semiconductors adds more jobs in the U.S. and also better positions the country to compete in the global economy.
Prioritizing EVs is an encouraging step when it comes to reaching net zero, as personal vehicles account for about one-fifth of all emissions in the U.S. Making sure the U.S. reaches its goal with the environment in mind at every step is what will truly make a difference in the fight against global warming. The CHIPS Act doesn’t necessarily specify the composition of the chips, but much research has been done on the environmental consequences of creating semiconductors with silicone carbide (SiC) or gallium nitride (GaN).
Though SiC does release fewer emissions than fossil fuels, SiC has its limits when it comes to higher voltages. GaN can withstand even higher voltages than SiC, which typically withstands voltage five to 10 times stronger than its older silicon chip counterparts. Research is pending on whether GaN technology will ultimately be the better move for the planet but it’s certainly something consider as the U.S. looks to lead the way in both semiconductors and EV manufacturing. Already, companies like General Motors and Tesla are looking to break their dependence on silicon and are weighing the two.
It’s something the Commerce Department has already considered. The agency voluntarily solicited companies to send inventory, usage, and sales data and is sorting through the 150 submissions it received in order to help identify supply chain problems and possibly find solutions that will hopefully keep climate change mitigation front-and-center. It’s unclear when the House will take up the CHIPS Act but Raimondo’s push certainly puts it in the spotlight. President Biden may very well speak on the issue when he speaks on Wednesday about supply chain issues.
Raimondo spoke with reporters ahead of a series of events she attended in Detroit on Monday, including a roundtable with lawmakers at UAW Region 1A headquarters. “We're at an inflection point and we have to make choices," Raimondo said. "If we're serious about restoring American leadership in the global economy, we have to start by rebuilding our semiconductor industry so we can meet the demands of this moment.”
Producing semiconductor chips, Raimondo said, is “necessary for our American economic competitiveness, it's necessary if we're going to meet our climate change goals, and it's necessary to create jobs.” One way to get there is by passing the CHIPS Act, a bill that allocates $52 billion to boost the domestic semiconductor manufacturing sector. Introduced last year, the bill was passed by the Senate in June but has yet to be taken up by the House.
Electric vehicles require significantly more semiconductor chips than their gas-guzzling counterparts. Whereas an average gas-powered car can have between 50 and 150 chips, some EVs contain thousands of chips. According to nonprofit clean vehicle consortium CALSTART, up to 70% of an electric car’s components may be different from a gas-powered car’s. Raimondo also noted that having self-reliance when it comes to semiconductors adds more jobs in the U.S. and also better positions the country to compete in the global economy.
Prioritizing EVs is an encouraging step when it comes to reaching net zero, as personal vehicles account for about one-fifth of all emissions in the U.S. Making sure the U.S. reaches its goal with the environment in mind at every step is what will truly make a difference in the fight against global warming. The CHIPS Act doesn’t necessarily specify the composition of the chips, but much research has been done on the environmental consequences of creating semiconductors with silicone carbide (SiC) or gallium nitride (GaN).
Though SiC does release fewer emissions than fossil fuels, SiC has its limits when it comes to higher voltages. GaN can withstand even higher voltages than SiC, which typically withstands voltage five to 10 times stronger than its older silicon chip counterparts. Research is pending on whether GaN technology will ultimately be the better move for the planet but it’s certainly something consider as the U.S. looks to lead the way in both semiconductors and EV manufacturing. Already, companies like General Motors and Tesla are looking to break their dependence on silicon and are weighing the two.
It’s something the Commerce Department has already considered. The agency voluntarily solicited companies to send inventory, usage, and sales data and is sorting through the 150 submissions it received in order to help identify supply chain problems and possibly find solutions that will hopefully keep climate change mitigation front-and-center. It’s unclear when the House will take up the CHIPS Act but Raimondo’s push certainly puts it in the spotlight. President Biden may very well speak on the issue when he speaks on Wednesday about supply chain issues.