The ongoing semiconductor shortage has prompted the Biden administration to seek out sensitive data on exact chip orders and inventories across the supply chain.
The goal is to “both diagnose chokepoints in the supply chain and offer firms data that can help them adapt their production processes to adjust to the supply shortage,” the White House announced on Thursday.
According to US Secretary of Commerce Gina Raimondo, many companies expected back in May that the shortage would ease during Q3 2021, but that relief has yet to materialize. Instead, car companies including General Motors and Toyota have been forced to cut production.
“Four months later, the situation seems to be getting worse,” Raimondo said on Thursday. “We are hearing regularly from companies that cannot get the supply they need. We also know the (COVID-19) delta variant has closed down key factories. This could hinder our strong recovery and could persist throughout 2022.”
Not helping matters is the US’s limited visibility in the supply chain. “What’s still not clear is what specifically is happening,” Raimondo added. “For example, I don’t know who is overordering or who is not supplying at the levels expected…There’s so little transparency across the board. And that can’t continue.”
However, the White House’s call for transparency may face a chilly reception because the data at stake is quite sensitive. For example, the government is asking chip providers to identify their top customers and divulge annual sales data, including how quickly they fulfill orders. Chip buyers are also being asked to detail how the semiconductor shortage has disrupted production.
For now, the Commerce Department is calling on companies to share the data on chip orders and inventories voluntarily. However, Bloomberg notes the Biden administration is mulling invoking a national security law to compel industries to hand over the data.
The so-called “request for information” is open to anyone, but the Commerce Department is focused on gathering input from both foreign and domestic companies involved in the semiconductor supply chain.
By identifying bottlenecks, the Commerce Department is also hoping it can pinpoint areas the chip industry can invest in to prevent future shortages. “For example, the survey may show that the chips used in sensors that help activate a pacemaker and power the safety features of a car are in shortage, but not the ones that support power management on a device,” the White House added. “In this way, the information can also provide a clear demand signal that can attract more private investment to expand capacity to resolve the shortage.”
