The commerce department has asked for in-depth industry data from various organizations involved in the semiconductor supply chain since September 2021
The commerce department of the US, after pointing out a new survey, told the media that various firms and manufacturers in the country are short of important chipset, which would end in just five days. The report of the commerce department back in 2019 has clearly stated that firms used to maintain 40 days of inventory for important chips.
To get rid of the challenges, Gina Raimondo, Commerce Secretary said that the survey results point towards the congress to approve the U.S. Innovation and Competition Act on an urgent basis as it comprises $52 billion to perk-up chipset production. “We aren’t even close to being out of the woods as it relates to the supply problems with semiconductors," Ms. Raimondo told reporters Tuesday. “The semiconductor supply chain is very fragile, and it is going to remain that way until we can increase chip production."
To verify the facts, the commerce department has asked for in-depth industry data from various organizations involved in the semiconductor supply chain since September 2021. The report was completely based on a survey of firms that comprises material and equipment providers automotive, industrial and healthcare; semiconductor manufacturers that require processors for their products. The report also added that "This means a disruption overseas, which might shut down a semiconductor plant for 2-3 weeks, has the potential to disable a manufacturing facility and furlough workers in the United States if that facility only has 3-5 days of inventory."
According to experts in the country, the report has been released by the department to magnetize or bring back the U.S. Innovation and Competition Act. Hence, the senate passed a $250 billion incentive to uplift high-tech research and manufacturing and also a $52 billion package to widen the domestic production of semiconductors. The bill passed by the house strongly centers on supply chain problems sanctioning $45 billion for loans and grants to back-up supply chain flexibility and manufacturing of imperative goods.
In order to ease the inflation and supply chain challenges, President Biden has repeatedly highlighted the slump of semiconductors. To buckle it up, companies like Intel announced to invest $20 billion in new chip-making capacity in Ohio. But, the point to be noted is that in the past few years, companies moved to other countries for chip production, especially in Asia.