The bill follows a disruptive global microchip shortage in 18 months that has slashed auto production around the world and raised average vehicle transaction prices.
Automakers have taken 13.5 million vehicles off their factory schedules since early 2021, according to estimates by AutoForecast Solutions. This includes approximately 4.3 million vehicles in North American assembly plants.
The industry’s appetite for semiconductors will only increase in the coming years as more electric vehicles are built and as infotainment offerings and driver-assistance systems become more advanced.
“Given the computing power of today’s increasingly digital and connected vehicles, this bipartisan investment in home semiconductor manufacturing is a smart investment in the future,” John Bozzella, CEO of the Alliance for Automotive Innovation, said in a statement.
For example, German supplier giant and semiconductor manufacturer Robert Bosch estimates that microchips will cost about $800 worth of a vehicle by the end of the decade, up from about $200 today.