In the months since his election, President Joe Biden’s explained what he wants to see from the automotive industry in the years ahead. Today he’s signing executive orders to help make some of those things happen.
The order addresses some of the supply chain issues hampering U.S. automakers now and moving ahead, such as dealing with the current shortage of semiconductors and increasing the production volumes of batteries for electric vehicles.
It starts with an “immediate 100-day review across federal agencies to address vulnerabilities” in the supply chains for certain areas, including semiconductor chips. Automakers reliant on the chips lately have been forced to idle plants because much of the semiconductor supply was shifted from the auto industry to other areas of electronics due to the pandemic.
“Make no mistake, we’re not simply planning to order up reports. We are planning to take actions to close gaps as we identify them,” the administration official added, according to Reuters.
New order puts focus on problem
The Biden administration attempted to pressure Asian governments in countries where the chips are produced, specifically Taiwan, hoping to secure a promise to ramp up production levels. However, that push has been largely ineffective.
As a result, Biden looks to solve the problem from the inside, saying that despite leading the way in the development of semiconductors, we’re now behind. “(O)ver the years we have underinvested I production — hurting our innovative edge — while other countries have learned from our example and increased their investment in the industry.”
The review will study how to “better leverage our sizeable lithium reserves” to expand electric vehicle battery production. Biden wants to create 1 million EV-related automotive jobs as well as have 500,000 EV chargers in place by 2030.
A longer-term study, also part of the order, aims to find ways to shore up the country’s various supply chains to better ensure the auto industry and other sectors don’t fall victim to something like this again.
Industry response to the effort
Automakers offered up praise for the administration’s action plan.
“As America’s No. 1 auto producer, we greatly appreciate President Biden’s swift actions to remedy the near-term semiconductor shortage and review longer-term actions to develop a more resilient and secure supply chain,” Ford Motor Co. said in a statement. The automaker earlier warned it could see production cut as much as 20% due to the issue.
“It is incredibly important for our labor force, our customers and our business that we have a commitment to end this shortage as soon as possible. We stand ready to work with the Biden Administration on these efforts.”
General Motors also issued a statement in concert with the American Automotive Policy Council, which represents U.S. automakers, in support of the move.
“We thank President Biden and the administration for their efforts to address the global shortage of auto-grade semiconductor wafers,” said Matt Blunt, president of the AAPC and former governor of Missouri, which is home to several auto plants.
“The U.S. auto industry needs immediate action to resolve plant closures and U.S. vehicle production losses, which are impacting hundreds of thousands of American auto workers, our customers, our businesses and our economy. We additionally look forward to working with the administration on long-term actions that secure our domestic supply chain to avoid any future chip supply shortages.”
GM’s cut production at plants in the U.S., Canada and Mexico because of the issue.