Bill to subsidize U.S.-made semiconductor chips aims to lower cost of cars, other consumer products

REDLANDS, Calif. (KABC) -- The CHIPS and Science Act is a large technology package that aims to strengthen the United State's competitiveness in the semiconductor market.

On a more basic level, the package will allow Americans to keep on using their electronics in the future without the global microchip shortages that impacted the country during the pandemic.

"I'd say by the summer after the start of COVID we started running low on vehicles," said Bill Hatfield, owner of Hatfield GMC Buick Redlands.

Despite lockdowns and travel bans, the sell of vehicles didn't slow down.

"I don't think anyone expected people to come out and buy cars during the pandemic but they did," Hatfield said.

What did slow things down was the worldwide shortage of semiconductors, which caused the price of new vehicles to surge and made finding parts to fix older vehicles hard to come by.

It also made other things like buying a smartphone, computer or anything with a microchip more expensive.

Last week, law makers in Washington D.C. did something about it.

"The House of Representatives passed the CHIPS and Science Act realizing that only 12% of the semiconductor chips that go into our cellphones, our automobiles, our military equipment, only 12% are made in the United States," said Southern California Rep. Pete Aguilar.

Aguilar touted the $52-billion package while visiting Hatfield GMC Buick dealership and speaking to Hatfield and his employees.

A large portion of the money is allocated for the semiconductor industry as an incentive to companies to manufacture the computer chips in the United States.

"This is important for our national security, making sure that we manufacture these chips in the United States is important, We don't want to be reliant on outside countries for our national defense," said Aguilar.

While the impact of the new legislation won't be felt immediately, Hatfield believes it's a step in the right direction to ease supply and eventually the price to buy a new or used vehicle.

"The last couple of years have been difficult, and I think it is very important that we get these chips made in the United States, so that we have control over the destiny of our industry, "said Hatfield.

President Joe Biden is expected to sign the CHIPS and Science Act next Tuesday.