Seeking to ease bottlenecks in the production of cars and consumer electronics, the Biden administration says it may invoke the Defense Production Act to obtain data on the semiconductor supply chain.
The Biden administration is considering invoking a Cold War-era national security law to force companies in the semiconductor supply chain to provide information on inventory and sales of chips, Commerce Secretary Gina Raimondo said Thursday.
The Commerce Department is asking companies to fill out questionnaires within 45 days providing supply chain information. The request is voluntary, but Raimondo said she warned industry representatives that she might invoke the Defense Production Act or other tools to force their hands if they didn’t respond.“What I told them is, ‘I don’t want to have to do anything compulsory, but if they don’t comply, then they’ll leave me no choice,’” she said.
A global shortage of chips that power products as diverse as laptops and automobiles has continued to affect production in many industries, and finding medium- and long-term solutions has been a priority since President Biden took office. The information request — and potential enforcement through the production act or other means — is necessary because there’s a lack of trust among companies in the supply chain, she said.“There’s allegations of certain consuming companies buying two or three times what they need and stockpiling,” Raimondo said. “So suppliers say, ‘We can’t get a handle on an accurate demand signal because consumers are stockpiling, so we don’t know what the accurate demand is.
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