Michigan works to attract chip makers under new governor’s U.S. bill

Michigan Governor Gretchen Whitmer speaks during the 2021 Motor Bella auto show in Pontiac, Michigan, U.S., September 21, 2021. REUTERS/Rebecca Cook

WASHINGTON, Aug 2 (Reuters) – Michigan Governor Gretchen Whitmer said the state is well-positioned to attract new investment in semiconductor chip manufacturing after Congress voted $52 billion in new subsidies.

“The state of Michigan is uniquely positioned,” Whitmer said in an interview with Reuters. “We want to make sure that our potential partners in this moment of chip production are ready to move as fast as we are because we’re going to have to move together.”

President Joe Biden is expected to sign the Chips and Science Act early next week. The bill provides about $52 billion in government subsidies for U.S. semiconductor production and an investment tax credit for chip factories estimated at $24 billion.

Biden on Tuesday will actually attend an event in Michigan to mark Whitmer’s signing of an executive order to position the state to compete for chip manufacturing funding.

The Detroit Three automakers have been particularly hard hit by the chip shortage and have often been forced to halt production due to chip shortages over the past two years.

Last week, General Motors Co ( GM.N ) said it had more than 90,000 unfinished vehicles, mostly trucks and SUVs, waiting for brands and other parts, while Ford said last week it had 18,000 vehicles waiting for brands.

Right now there are tens of thousands of otherwise complete vehicles parked in southeast Michigan waiting for chips so they can be delivered.

Congress last week approved sweeping legislation to subsidize the domestic semiconductor industry, hoping to bolster companies as they compete with China and ease a persistent shortage that has affected everything from cars and guns to washing machines and video games.

“I think we’re going to see companies start to make decisions,” Whitmer said, adding that Michigan “has a lot of built-in advantages, including built-in customers” and a skilled engineering workforce.

Senator Mark Warner said last week that the bill would help fund 10 to 15 new semiconductor factories. “If we hadn’t done this, there would never be another American semiconductor factory in this country,” Warner said.

Report by David Shepardson. Edited by David Gregorio

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