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Biden administration outlines measures to deal with supply chain problems

[Washington]The Biden administration outlined new steps to address widespread supply chain issues on Tuesday.

Steps, including the creation of a new government supply chain task force, 100-day review The pandemic revealed problems that continue to affect key industries, including car manufacturing, and was ordered by President Biden in February.

This review covers four areas. Semiconductors used in products from automobiles to telephones. Large-capacity battery used in electric vehicles.Pharmaceuticals and rare earth elements Technology and defense keys..

“While amplified by public health and the economic crisis, decades of investment shortages and public policy choices have weakened supply chains across disciplines and products.” White House document says The survey results are summarized. “At the same time, the review found that the United States is in a good position to maintain and strengthen its innovative leadership and rebuild capacity in key sectors and value chains.”

The Secretary of Commerce, Transportation and Agriculture will form a new supply chain task force focused on sectors that have experienced supply disruptions and demand issues, such as housing construction and construction, semiconductors, transportation and food, officials said. Stated.

The review calls for a number of actions that represent supply chain issues and the government’s more active role in domestic manufacturing, many of which are aimed at competing with China. They include:

• Use the Defense Production Act enacted during the Korean War to encourage domestic industry to strengthen its armaments and form a public-private consortium for the production of essential medicines. The Department of Health and Human Services will initially spend $ 60 million towards that goal.

• Invest in the production of advanced automotive battery cells and establish a new manufacturing plant using the energy sector’s financing authority.

• Establish a “trade attack force” that proposes enforcement measures against what the administration says against unfair foreign trade practices such as government subsidies that erode critical supply chains and strengthen cooperation with allies. To do.

• Propose a financing program for US manufacturing facilities and infrastructure projects under the US Export-Import Bank.

Neodymium is essential for spinning Tesla wheels and producing sound on Apple’s Airpods, and China dominates the mining and processing of this rare earth element. As a result, the United States and its allies are building their own supply chains. Photo Illustration: Clément Bürge / WSJ

One trade measure requires the Department of Commerce to begin an investigation. This investigation may impose tariffs on neodymium magnets used in motors and defense equipment, mainly imported from China.

The government also feels that automakers are under the most pressure as they try to address the semiconductor shortages that are driving slowdowns in production, from consumer electronics to computers.

Ford motor Co., Ltd.

,

General Motors Co., Ltd.

And

Stellantis

NV, the manufacturer of Jeep and Chrysler, has all sought help from the government, but no short-term government solution has been realized.

Chips are used in vehicle braking systems, touch screens, and many other components. However, there is also high demand for home appliances and other products that have become popular with people forced to stay home during the pandemic.

The Biden administration has worked to reach out to foreign suppliers to improve supply chain transparency, but short-term solutions are elusive. The broader goal is to increase domestic chip production.

Proposed by Mr. Biden $ 50 billion investment The US semiconductor industry is shifting a lot of production abroad, and as part of its infrastructure proposal, Republicans have opposed it over its size and the taxes it requires. But the industry also China-related legislation The Senate is ready to vote on Tuesday afternoon.

Mr. Biden will leave First overseas trip Whitehouse officials said this week they will raise supply chain issues in consultation with European leaders. The focus is on bringing manufacturing to the United States, but the administration is in China. It is also important to strengthen relations with allies in order to reduce dependence on geopolitical competitors such as.

The global chip shortage is affecting the time it takes to drive a car or buy a new laptop. The WSJ will visit a manufacturing plant in Singapore to see the complex process of chip manufacturing and how one manufacturer is trying to overcome the shortage.Photo: Edwin Chen of The Wall Street Journal

Write to Alex Really alex.leary@wsj.com

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Biden administration outlines measures to deal with supply chain problems

Source link Biden administration outlines measures to deal with supply chain problems

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