Auto Industry Grapples with Parts Shortages, Toxic Politics in 2021

2021 has been a difficult year to navigate so far for American auto companies. We’re seeing an ongoing semiconductor chip shortage that has caused automakers to curtail production. And controversial legislation — including a nationwide GOP effort that would make it harder to vote — has led many corporations to wade into political waters.

MichMash hosts Cheyna Roth and Jake Neher talk with Detroit News Washington correspondent Riley Beggin about how American automakers are navigating these challenges and why it matters to all Michiganders.

Beggin explains what a semiconductor chip is and why it’s causing such a ruckus in the auto industry and in Washington, D.C.

“A semiconductor chip is basically the microchip that you are envisioning, that goes in your cellphone, your other consumer electronics,” she says. “But there’s also tons of them in vehicles. There are even more and electric vehicles, but even your traditional gas-powered car has several of these chips in them. It powers your power steering, rolling down your windows, and of course, the GPS and the other sort of entertainment aspects of a car.”

“They are fundamental parts of cars that we expect to have now,” Beggin continues. “So when there’s a shortage of them, we’re having a huge backup in production. And, of course in Michigan, that also means it’s affecting people’s jobs and people’s pay and time on work.”

“What the automakers are asking the Biden administration to do is to basically play a political role in helping set aside a certain amount of semiconductor chips for the auto industry.” –Riley Beggin, Detroit News

The auto industry has been in talks with the Biden administration on ways to address the shortage. Beggin explains that these chips are also used by other industries, including Big Tech. That means there’s competition between a number of major industries in the U.S. to obtain more of these semiconductors.

“What the automakers are asking the Biden Administration to do is to basically play a political role in helping set aside a certain amount of semiconductor chips for the auto industry,” says Beggin. “Whether or not the Biden administration is going to help them with that — we’ll see.”

When it comes to auto companies getting involved in political disputes in 2021, Beggin says they joined a number of other corporations in Michigan last week trying to send a message to lawmakers about efforts to make voting more difficult.

“Several major companies in Michigan released a letter sort of outlining their commitment to equitable voting and saying that they were opposed to any policies that would basically make it harder to vote. You know, they aren’t really clear about what they’re opposing. But the timing is certainly clear.”