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LRCX - Lam Research News Story

$662 -6.0  -0.9%

Last Trade - 09/04/21

Sector
Technology
Size
Large Cap
Market Cap £69.01bn
Enterprise Value £68.86bn
Revenue £8.70bn
Position in Universe 135th / 6827

Automakers, medical device firms ask Biden for U.S. chip factory subsidies

Thu 18th February, 2021 10:00am
By Stephen Nellis
    Feb 18 (Reuters) - More than a dozen business groups
representing automakers, medical device makers and manufacturers
sent a letter to President Joe Biden on Thursday calling on him
to work with U.S. lawmakers to provide federal funding for the
construction of new chip factories.
    The groups, which include the U.S. Chamber of Commerce as
well as industry-specific associations representing General
Motors Co  GM.N , Caterpillar Inc  CAT.N  and Medtronic PLC
 MDT.N , among others, sent the letter as a shortage of
semiconductors continues to disrupt U.S. automobile factories
and threatens to lower the automakers' profits by billions of
dollars.
    A group of chipmakers last week sent a similar letter.
 urn:newsml:reuters.com:*:nL1N2KH06Z Congress authorized programs last year to provide
subsides for chip research and factory construction, but U.S.
lawmakers still need to provide specific funding for the
program.
    "To be competitive and strengthen the resilience of critical
supply chains, we believe the U.S. needs to incentivize the
construction of new and modernized semiconductor manufacturing
facilities and invest in research capabilities," the business
groups wrote in their letter on Thursday.
    The majority of chip production, especially for advanced
computing chips, now occurs in Asia, where major contract
manufacturers such as Taiwan Semiconductor Manufacturing Co Ltd
(TSMC)  2330.TW  and Samsung Electronics Co Ltd  005930.KS 
handle production for hundreds of different chip companies. Both
TSMC and Samsung are planning new U.S. chip factories in the
next few years that could benefit from the program if it is
funded.
    In addition to funding existing programs, the business
groups also called for an "investment tax credit" that could
help defray the cost of semiconductor manufacturing tools, which
can cost billions of dollars for new factories and typically far
outstrip the cost of buildings. 
    American toolmakers such as Applied Materials Inc  AMAT.O ,
Lam Research Corp  LRCX.O  and KLA-Tencor Corp  KLAC.O  dominate
the industry, though Netherlands-based ASML Holding NV  ASML.AS 
 and Japan's Tokyo Electron Ltd  8035.T  are also major players
in some segments.

 (Reporting by Stephen Nellis in San Francisco; Editing by
Christopher Cushing)
 ((Stephen.Nellis@thomsonreuters.com; (415) 344-4934;))
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