Edit

Schumer Reveals: With Over 1/3rd Of Inflation Due To Auto Prices, Microchip Shortage Has Hurt The Pockets & Timelines For Western New Yorkers

Government and Politics

August 13, 2022


SCHUMER REVEALS: WITH OVER 1/3RD OF INFLATION DUE TO AUTO PRICES, MICROCHIP SHORTAGE HAS HURT THE POCKETS & TIMELINES FOR WESTERN NEW YORKERS; AS DELAYED AUTO MANUFACTURING DRIVES UP COSTS, INFLATION, & CAUSES ENDLESS DELAYS, SCHUMER, STANDING WITH WNY CAR SELLERS & GENERAL MOTORS WORKERS, LAYS OUT PLAN TO LOWER COSTS & REBUILD THE MICROCHIP SUPPLY CHAIN TO HELP NEW YORKERS GET THE CAR THEY WANT QUICKER

Microchip Shortage Has Led To Worsening Inflation, Endless Delays, and Makes U.S. Vulnerable To Supply Chain Disruptions; Current Shortages Have Slowed Auto Manufacturing Across US, Including At NY Plants, Making Finger Lakes Families Wait Months For Their Cars

Schumer’s Historic CHIPS Bill Will Create First Of Its Kind Fed Incentives To Make Semiconductors In Places Like WNY STAMP In Genesee County; Senator Reveals How Just Passed Inflation Reduction Act Will Supercharge Electric Vehicle Manufacturing & Affordability In Another Win For Families At The Car Lot

Schumer: WNY Families Keep Hitting Speedbumps When It Comes To Buying Cars; My Bipartisan Bill Will Be The Greenlight For Chips & Let People Drive Home The Car They Want

Standing at Bob Johnson Chevrolet in LeRoy where people are facing months-long waitlists for the cars they want, U.S. Senate Majority Leader Charles E. Schumer today revealed how his just-passed, bipartisan CHIPS and Science Bill will help fix our supply chain problems and bring down inflation by bringing chip manufacturing back from overseas to places like Upstate New York, helping get families back on the road in their dream cars. Schumer explained the national semiconductor shortage sent shock waves through the auto-industry, resulting in factories like GM’s Tonawanda plant having to scale back production because they lack the chips they need to finish the cars. Forcing families across the country and in Western NY to wait for months, and then also sky rocketing prices within the used car market, worsening inflation and making a bad situation even more frustrating for consumers. Schumer said that his CHIPS bill, in tandem with new investments from the just passed Inflation Reduction Act, will help lower costs for families from energy to electric vehicles, creating new good paying manufacturing jobs, and to stop hits to families wallets and giving them more options when buying a car.

“The national chip shortage is driving up costs, driving up inflation and driving Rochester families mad with months long waits to drive home in the car they want. But I am here to say that this red light our auto manufacturers have been caught at is about to turn green, because we just passed two big bills that are going to accelerate our economic recovery, fight inflation, and put America in the fast lane to rebuild our manufacturing sector for microchips and much more,” said Senator Schumer. “My CHIPS and Science bill will be the lightning rod to bring semiconductor manufacturing jobs back from overseas to places like Upstate New York, giving our local auto-plants from Rochester to Tonawanda and beyond, a strong domestic supply chain of chips to prevent delays and make it so families don’t have to wait months for a new car.”

Schumer added, “And if you are looking for an electric car the Inflation Reduction Act that I just led to passage has you covered with new supercharged tax credits to bring down the cost, and programs so to encourage companies to build even more electric vehicles here at home. Making cars cheaper for the consumer, creating good paying American jobs, and fighting climate change. A true win-win-win!”

Brad McAreavy, President of the Rochester Automobile Dealers Association said, “I want to thank Senator Schumer for leading the effort to address the critical supply chain issues facing the auto industry. The chip shortage has severely constrained the inventory of new vehicles for consumers, and has put a strain on the over 100 dealerships in our region and their employees.  We’re looking forward to this legislation bringing dealerships back to normalcy and laying the foundation to reduce future disruptions to our supply chains in the years to come.”

Schumer explained that the microchip shortage is impacting everything, saying it is one of the major contributors to inflation and is what is causing wait times for people to buy cars, computers, and even for essential medical equipment, many of which have back logs for months. A modern car can contain more than 3000 microchips, powering everything from climate controls to shift timing, with many newer cars containing even more, but since we make almost no microchips here at home the auto-industry has had its hands tied while it waits for chips. This is also sky rocketing the price for cars, especially used cars, worsening an already bad scenario.  One third of the core inflation last year in America was due to the high price of automobiles, which was driven by the shortage of semiconductors. Currently, only 12% of chips are manufactured domestically, compared to 37% in the 1990s, and many foreign competitors, including China, are investing heavily to dominate the industry. Nearly 75% of global semiconductor production is now occurring in East Asia and foreign government subsidies drive the majority of the cost difference for producing semiconductors overseas.

Schumer said that his CHIPS bill would alleviate supply chain bottle necks by helping bring these jobs back from overseas to places like Upstate New York such as the Western New York STAMP campus in Genesee County.  New York is currently home to over 80 semiconductor companies that employ over 34,000 NY workers, including global industry leaders like GlobalFoundries, Wolfspeed, onsemi, IBM, and other major microchip and innovation companies that support them like Corning Inc. in Monroe County which just announced a $139M, 270 job expansion in anticipation of this bill which just became law this week. Schumer said investments like these are only the beginning though, and the ripple effects from more chip fabs and their supply chains being built in places like Upstate New York will help ensure that long wait times for cars like this due to microchip shortages are a things of the past.

Specifically, Schumer highlighted that his CHIPS & Science Bill includes:

    -$39 billion for the CHIPS for America Fund to provide federal incentives to build, expand, or modernize domestic facilities and equipment for semiconductor fabrication, assembly, testing, advanced packaging, or research and development to help attract major chip manufacturers to shovel ready sites like WNY STAMP in Genesee County.  

    -$11 billion for Department of Commerce research and development including creating a National Semiconductor Technology Center (NSTC) a public-private partnership to conduct advanced semiconductor manufacturing, with Albany Nanotech primed to be a top contender to serve as a major hub for the NSTC, and other specialized R&D programs that universities across the state are in a strong position to compete for.

    -$2 billion for the DoD CHIPS for America Defense Fund.

    -$200 million for the CHIPS for America Workforce and Education Fund to kick start development of the domestic semiconductor workforce, which faces near-term labor shortages, by leveraging activities of the National Science Foundation.

    -A new Investment Tax Credit for semiconductor manufacturing facilities and equipment.

In addition, Schumer also highlighted recent wins he was able to secure in the just passed Inflation Reduction Act, the largest investment in clean energy ever, that will also lower costs and fight inflation by reducing the deficit. Schumer said that include among these many provisions is two new clean vehicle tax credits – one for new vehicles and one for used - that will bring down the upfront cost of clean vehicles estimated to provide $10 billion in benefits. This will provide $4,000 in consumer tax credit for lower and middle income individuals to buy used clean vehicles, and up to $7,500 tax credit to buy new clean vehicles. On top of that, the bill also includes tens of billions in production and investment tax credits to build clean technology manufacturing facilities, like facilities that make electric vehicles, that can help drive manufacturing expansions in Upstate New York in facilities. Plus, billions more in cost saving measures to fight inflation, lower healthcare costs, and reduce energy costs giving families the relief they need whether it be at a car lot or the doctor’s office.