Sen. Elizabeth Warren has claimed company greed is accountable for a worldwide chip shortage that has pushed the price of cars to eye-popping ranges.
“[M]arket concentration has reduced competition, allowing giant corporations to deliver massive returns for shareholders,” Warren (D-Mass.) argued in a Thursday letter to Commerce Secretary Gina Raimondo, in line with a CNN Business report.
“But it has harmed consumers by enabling these dominant companies to increase prices and underinvest in key capabilities, which has the effect of also reducing product innovation and product quality,” Warren added.
The senator went on to notice that 5 producers management 54 % of the worldwide semiconductor market and argued that these situations create a near-monopoly, permitting firms to jack up costs.
As semiconductor chips change into tougher to search out, main automotive firms like Ford and Common Motors have needed to cut back the variety of vehicles they manufacture and lift costs accordingly.
Warren particularly known as out Taiwan Semiconductor Manufacturing Co., which sells to main tech firms together with Apple and Nvidia, in addition to “cutting-edge” chip maker ASML.
“So while dominant semiconductor companies like TSMC and ASML post massive profits and reward shareholders,” she wrote, “consumers are harmed by shortages and higher prices.”
Whereas Warren blamed firms for the chip scarcity, others level to exterior elements like COVID-19 and global supply chain issues.
Final yr Congress handed the CHIPS Act, which goals to extend home manufacturing of pc chips — simply 12 % of which had been made within the US as of 2020.
Warren has been on the anti-corporate warpath of late. Final week, she wrote a letter calling out automotive rental firm Hertz for spending cash on share buybacks whereas elevating the worth of car leases.