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Biden's $52 Billion Semiconductor Package Is a Big Deal, Especially for Automakers

The bill would provide $2 billion to automakers alone, and increase semiconductor manufacturing in the U.S.

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Semiconductor chips are sorely needed right now, especially for the auto industry. It’s why new cars are hard to come by, and also why some manufacturers have lots full of hundreds — even thousands of vehicles sitting. They’re all missing semiconductor chips. But recently introduced legislation called the CHIPS and Science Act is looking to change that, as MLive reports the bill would bring badly needed semiconductor production back to the U.S.

Semiconductors have been around since the 1700s. However, what originated in the U.S., soon left our shores thanks to the advent of the computer age, and cheaper manufacturing costs, facilities and manufacturing those chips in places like Asia. Today, Asia makes 75 percent of the world’s semiconductors, while the U.S. makes just 12 percent.


The bill allocates $2 billion to incentivize semiconductor production specifically for the parts industry and automakers, who need it the most, especially for Michigan, home to GM, Ford and Stellantis, and a network of OEMs that provide parts to those automakers. Michigan State Senator Debbie Stabenow saying, “This is a big freakin’ deal for Michigan. We’re seeing a renaissance in manufacturing here in Michigan and in America.”

While some may wonder why automakers are singled out with such a nice chunk, you have to look at the broader impact of the chip shortage. While automakers make up just 11 percent of global semiconductor chip usage, the shortage has hit the industry harder than most. Enough that MLive says the auto industry has essentially been idled. Data from Auto Forecast Solutions shows that 2.2 million vehicles were affected by chip shortages costing over 300 days of work that affected nearly 600,000 automotive jobs.


President Biden said the Chips act will prepare the country for the future. “The auto industry is the heart and soul of the nation. One of the reasons why I’m so excited about the CHIPS and Science Act is that it sees that future for decades to come” he said.