A bipartisan bill to bolster domestic semiconductor manufacturing and boost U.S. competitiveness with China has cleared a key Senate vote, setting it up for final passage in the chamber.
The cloture motion to break a legislative filibuster took place Tuesday. The vote passed 64-32.
The package, known as “CHIPS-plus,” includes roughly $52 billion in funding for U.S. companies producing computer chips and a provision that offers a tax credit for investment in chip manufacturing. It also provides funding to spur the innovation and development of other U.S. technologies.
Cummins CEO Tom Linebarger and Medtronic CEO Geoff Martha were among labor leaders who met with President Joe Biden via teleconference to discuss the importance of passing the package.
Senate Majority Leader Chuck Schumer, (D-N.Y.), said he hopes lawmakers “can remain on track to finish this legislation ASAP.”
Linebarger said many industries are facing a supply chain crisis and are unable to get semiconductors and other needed components that make “everything happen” in the industrial and medical sectors.
“The semiconductor shortage has not only impacted our ability to meet customer demand but the technology and equipment we need to run our operations,” Linebarger said. “We rely on semiconductors to power our machines, to put our electronic control modules in our engine systems that control emissions, even to make badges for our employees so that they can all come back to work.”
Cummins buys a full range of semiconductors, including larger-scale, robust legacy chips that serve applications and power trucks and cars. Manufacturing delays and costs increased along with supply chain woes, Linebarger said, resulting in Cummins buying chips from brokers and paying 10 times the usual chip cost, driving inflation.
Semiconductor use in cars, trucks and industrial equipment is expected to increase exponentially, especially with the advent of industries shifting to electronic vehicle technology, Linebarger said. The need for legacy chips was not anticipated, putting the U.S. chip manufacturing industry behind. The shortage needs to be remedied to allow the U.S. to innovate new solutions, export them and grow business, he said.
“We believe the CHIPS for America Act will go a long way to ensure not only the high-tech chips are made for the innovation of tomorrow, which is critical, but also that these basic and legacy chips are also provided as part of our supply chain,” Linebarger said. “… the investments made in the CHIP Act are going to move us from wringing our hands about where we sit in competition with others, to actually moving onto the field and helping the U.S. manufacturers compete. And I think we all know that when U.S. manufacturers compete with the workforce that we have and the capabilities we have, we can win.”
If the legislation passes the Senate as expected, the House will take up the bill. Supporters of the bill hope Congress will pass it and send it to Biden for his signature before Congress’ August recess, which begins in two weeks.
“I want to thank everyone for joining today’s meeting. I know I’ve kept you a long time here,” Biden said. “But the CHIPS Act, in my view, is going to advance the nation’s competitiveness and our technological edge… Congress must pass this bill as soon as possible, so we can get it to my desk, so we can sign it and get moving.”
