The US really has to start making more of it's own stuff

[Hvizsgyak]

Every time my wife and I are out driving around the Tampa, Fl area, we comment on how many of the small businesses show up everywhere. Carwashes, storage facilities, Dollar Generals and Family Dollar Stores, fast food restaurants, banks, auto shops, Wal-Greens and CVS Stores and car dealerships. The other small businesses that don't stick out by name are lawncare businesses, pool care businesses, pest control businesses, and house care businesses. We are flooded with these small businesses. Not many white collar businesses.

So the reason I am bringing this up is because my wife and I were looking for a car the other day. As I said above there is no shortage of car dealerships in the area, so we went to the Toyota Dealership where we bought our last car (one of the biggest in the area). We had heard that there was a shortage of used cars and the ones that weren't sold were as expensive as a new car. We decided we would buy new then. The Toyota Dealership had a decent amount of SUVs but smaller vehicles, no. We were looking for the CH-R or the Corolla Hatchback new. NONE. One used Corolla Hatchback (2019) @ $32,500 and one used CH-R (2021) @ $38,500.

I said, "Honey lets check the next dealership" - Honda. Same thing, larger size SUVs, no Civics or H-RVs. "Honey lets try another Toyota Dealership and a KIA Dealership. Empty. Why?

Why the heck is there still a chip shortage for cars? - Roadshow (cnet.com)

So after reading this article among many other, I kind of understand why. One of the other articles said the shortage of cars can be blamed on the car industry not placing their orders for microchips early enough and that the microchip companies (which are few in number to begin with and mainly in China (why?)) were working on other companies' needs.

So my question is is why we can't make our own microchips here in the US. We may but I suspect they are expensive due to labor. Maybe if we had as many microchip companies as we do storage facilities and car washes, we could get the prices down. But truthfully, I can't say much because I hear you have to be well educated and work under tedious conditions to make these chips (hence the expensiveness of the labor and its cheaper in China).

I'm done venting; I just wish we were alittle bit more self sufficient.

 

[ozso]

Sadly as you say, the simple answer is that the Chinese ask for considerably less pay to make microchips etc than Americans. Sad to hear this is still an issue, since I remember it being a problem over a year ago. I have to hope and pray that my 2004 Camry with 243,000 miles on it holds up, until the madness ends. If it ends.

 

[Arcangl86]

We do make our own microchips here. We just don't make enough. But there have been several companies announcing big investments in the US towards semiconductor manufacturing. It might make a long term difference.

 

[ozso]

Doesn't "Silicon Valley" still exist?

 

[RDKirk]

We do make our own microchips here. We just don't make enough. But there have been several companies announcing big investments in the US towards semiconductor manufacturing. It might make a long term difference.

I had an acquaintance (he's been dead a few years now) who ran a company that makes photographic electronic flash systems. He was fiercely proud that his equipment was fully American-made (the only such company in America). But by 2005, he complained bitterly that it was nearly impossible to get his new circuit boards fabricated in the US, and basic electronic components were already impossible for him to get from US sources.

Oh, if one needed to place an order as big as General Dynamics or Raytheon, there were American companies glad to fill it. But if you needed only a few hundred thousand units...no joy.

This is what I saw myself: In the 80s, I had an Air Force role that required me to place Requests for Proposals for small numbers of various proprietary parts for the SR-71 and U-2 reconnaissance aircraft systems in what was then the government Commerce Business Daily.

Companies all across the nation read the Commerce Business Daily newspaper to get in on government contracts. When I put in a Request for Proposal ("Can anyone build a few widgets like this?"), I'd usually get hundreds of bids from machine shops across the country. There were scads of companies willing to bid for some lucrative SR-71 money (yes, we did, indeed, have $200 ball peen hammers for the SR-71), even if it was for a short-term requirement.

In the 90s, I wound up in a similar role. By then, the Commerce Business Daily was a website. But when I put out an RFP, instead of hundreds of responses I got...the sound of crickets.

 

[disciple Clint]

Every time my wife and I are out driving around the Tampa, Fl area, we comment on how many of the small businesses show up everywhere. Carwashes, storage facilities, Dollar Generals and Family Dollar Stores, fast food restaurants, banks, auto shops, Wal-Greens and CVS Stores and car dealerships. The other small businesses that don't stick out by name are lawncare businesses, pool care businesses, pest control businesses, and house care businesses. We are flooded with these small businesses. Not many white collar businesses.

So the reason I am bringing this up is because my wife and I were looking for a car the other day. As I said above there is no shortage of car dealerships in the area, so we went to the Toyota Dealership where we bought our last car (one of the biggest in the area). We had heard that there was a shortage of used cars and the ones that weren't sold were as expensive as a new car. We decided we would buy new then. The Toyota Dealership had a decent amount of SUVs but smaller vehicles, no. We were looking for the CH-R or the Corolla Hatchback new. NONE. One used Corolla Hatchback (2019) @ $32,500 and one used CH-R (2021) @ $38,500.

I said, "Honey lets check the next dealership" - Honda. Same thing, larger size SUVs, no Civics or H-RVs. "Honey lets try another Toyota Dealership and a KIA Dealership. Empty. Why?

Why the heck is there still a chip shortage for cars? - Roadshow (cnet.com)

So after reading this article among many other, I kind of understand why. One of the other articles said the shortage of cars can be blamed on the car industry not placing their orders for microchips early enough and that the microchip companies (which are few in number to begin with and mainly in China (why?)) were working on other companies' needs.

So my question is is why we can't make our own microchips here in the US. We may but I suspect they are expensive due to labor. Maybe if we had as many microchip companies as we do storage facilities and car washes, we could get the prices down. But truthfully, I can't say much because I hear you have to be well educated and work under tedious conditions to make these chips (hence the expensiveness of the labor and its cheaper in China).

I'm done venting; I just wish we were alittle bit more self sufficient.

I agree with you, depending on China for medications is just foolish and that is just one example, what happens when we have a major fall out with China?

 

[tobyw]

.

 

[tobyw]

We do make our own microchips here.

Yep, and lots of them. The world's biggest chip maker, Intel, does most of its manufacturing in the US.

 

[Hazelelponi]

Every time my wife and I are out driving around the Tampa, Fl area, we comment on how many of the small businesses show up everywhere. Carwashes, storage facilities, Dollar Generals and Family Dollar Stores, fast food restaurants, banks, auto shops, Wal-Greens and CVS Stores and car dealerships. The other small businesses that don't stick out by name are lawncare businesses, pool care businesses, pest control businesses, and house care businesses. We are flooded with these small businesses. Not many white collar businesses.

So the reason I am bringing this up is because my wife and I were looking for a car the other day. As I said above there is no shortage of car dealerships in the area, so we went to the Toyota Dealership where we bought our last car (one of the biggest in the area). We had heard that there was a shortage of used cars and the ones that weren't sold were as expensive as a new car. We decided we would buy new then. The Toyota Dealership had a decent amount of SUVs but smaller vehicles, no. We were looking for the CH-R or the Corolla Hatchback new. NONE. One used Corolla Hatchback (2019) @ $32,500 and one used CH-R (2021) @ $38,500.

I said, "Honey lets check the next dealership" - Honda. Same thing, larger size SUVs, no Civics or H-RVs. "Honey lets try another Toyota Dealership and a KIA Dealership. Empty. Why?

Why the heck is there still a chip shortage for cars? - Roadshow (cnet.com)

So after reading this article among many other, I kind of understand why. One of the other articles said the shortage of cars can be blamed on the car industry not placing their orders for microchips early enough and that the microchip companies (which are few in number to begin with and mainly in China (why?)) were working on other companies' needs.

So my question is is why we can't make our own microchips here in the US. We may but I suspect they are expensive due to labor. Maybe if we had as many microchip companies as we do storage facilities and car washes, we could get the prices down. But truthfully, I can't say much because I hear you have to be well educated and work under tedious conditions to make these chips (hence the expensiveness of the labor and its cheaper in China).

I'm done venting; I just wish we were alittle bit more self sufficient.

I agree with you on making more of our own things and relying on foreign goods less...

But as for why are we still having shortages right now I do know China is closing down a lot of it's manufacturing atm ... The reason given is COVID outbreak (I'm not sure how much I believe that since they didn't shut down like this when COVID first hit). Granted that wouldn't necessarily affect what's on lots now but between COVID lockdowns, shipping issues and problems getting ships into ports due to various issues.. it's little wonder supply isn't keeping up with demand... And now, fun fun, China is shutting down a lot of manufacturing.

So yeah, I'm with you on trying to make our own goods..

 

[Dave G.]

The largest and best automotive chips are made in Taiwan, which of course China want to control. It's been a problem with the friction over there these days. I saw on TBN news the other night that USA is building a facility and looking to bring in a couple of Taiwans best people at this. Who knows how long all that takes. But it's more than that, we did it all right here at one time, heck even US steel moved off shore, TRW one of the largest parts manufacturers off shore, Moog brake parts off shore. Just about everything it takes to build a car is not manufactured here anymore. Oh we have car factories but not raw materials, they are exported from China, India, Taiwan etc. For the sake of green, we shifted the supposed filth of this work to another part of the world and became largely a service country. So exactly what did people think would happen one day anyway ? We shouldn't be surprised.

And it's not just cars.

 

[SamanthaAnastasia]

The medication distributer is shifting from China to India and Israel.
China has rare earth minerals hence why they can make microchips.
It’s also one of the reasons why Taiwan is such a big deal.
They are the biggest maker of microchips outside of China.

 

[HARK!]

Sadly as you say, the simple answer is that the Chinese ask for considerably less pay to make microchips etc than Americans. Sad to hear this is still an issue, since I remember it being a problem over a year ago.

I haven't done any careful research on this; so I'm just throwing some numbers out there, off the top of my head; but are car manufacturers really holding up the sale of a $30 K car, to avoid paying an extra $10 for a IC? I think that there must be more to it than that.

I believe that every car buyer, faced with the proposal, "you can have your car now for an extra $10; or you can save $10 and wait for an indefinite amount of time to get your car," would choose to pay the $10.

 

[dqhall]

Every time my wife and I are out driving around the Tampa, Fl area, we comment on how many of the small businesses show up everywhere. Carwashes, storage facilities, Dollar Generals and Family Dollar Stores, fast food restaurants, banks, auto shops, Wal-Greens and CVS Stores and car dealerships. The other small businesses that don't stick out by name are lawncare businesses, pool care businesses, pest control businesses, and house care businesses. We are flooded with these small businesses. Not many white collar businesses.

So the reason I am bringing this up is because my wife and I were looking for a car the other day. As I said above there is no shortage of car dealerships in the area, so we went to the Toyota Dealership where we bought our last car (one of the biggest in the area). We had heard that there was a shortage of used cars and the ones that weren't sold were as expensive as a new car. We decided we would buy new then. The Toyota Dealership had a decent amount of SUVs but smaller vehicles, no. We were looking for the CH-R or the Corolla Hatchback new. NONE. One used Corolla Hatchback (2019) @ $32,500 and one used CH-R (2021) @ $38,500.

I said, "Honey lets check the next dealership" - Honda. Same thing, larger size SUVs, no Civics or H-RVs. "Honey lets try another Toyota Dealership and a KIA Dealership. Empty. Why?

Why the heck is there still a chip shortage for cars? - Roadshow (cnet.com)

So after reading this article among many other, I kind of understand why. One of the other articles said the shortage of cars can be blamed on the car industry not placing their orders for microchips early enough and that the microchip companies (which are few in number to begin with and mainly in China (why?)) were working on other companies' needs.

So my question is is why we can't make our own microchips here in the US. We may but I suspect they are expensive due to labor. Maybe if we had as many microchip companies as we do storage facilities and car washes, we could get the prices down. But truthfully, I can't say much because I hear you have to be well educated and work under tedious conditions to make these chips (hence the expensiveness of the labor and its cheaper in China).

I'm done venting; I just wish we were alittle bit more self sufficient.

The Chinese spend less on personnel consumption, more on business investments. Their apartments are much smaller. They moved to cities and rely on cheap public transportation. I saw a YouTube video made by an American living in China. He said a cook earns $1000 a month. Their income is smaller, but it buys more in China than it would in America.

More chips are made in Taiwan and Korea than China. They are building new chip fabrication plants (fabs).
The Top 10 Semiconductor Companies by Market Share

China and Mexico are the top two exporters to the U.S.
The Top 10 Semiconductor Companies by Market Share

 

[tobyw]

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[hedrick]

Both Biden and Congress are looking at this. I’m not sure they’re doing enough, there are recent rules raising the amount of domestic content for products purchased by the US government. As noted, there has been some recent increase in investment in chip making here. But it seems that most people want things as cheap as possible.

For several decades, both parties have accepted the idea from economists that free trade was more efficient, and made life better overall. I have a background in economics. They are correct. But there are strategic dangers. I think that is only dawning on leaders now. I hope we’ll see some policy changes.

On cars. There are a number of cars made in the US, but they may not be what you would expect. https://cars.usnews.com/cars-trucks/the-best-cars-made-in-america

 

[RDKirk]

Yep, and lots of them. The world's biggest chip maker, Intel, does most of its manufacturing in the US.

Nothing runs on Intel chips alone. And many things have no Intel chips at all.

 

[RDKirk]

The largest and best automotive chips are made in Taiwan, which of course China want to control. It's been a problem with the friction over there these days. I saw on TBN news the other night that USA is building a facility and looking to bring in a couple of Taiwans best people at this. Who knows how long all that takes. But it's more than that, we did it all right here at one time, heck even US steel moved off shore, TRW one of the largest parts manufacturers off shore, Moog brake parts off shore. Just about everything it takes to build a car is not manufactured here anymore. Oh we have car factories but not raw materials, they are exported from China, India, Taiwan etc. For the sake of green, we shifted the supposed filth of this work to another part of the world and became largely a service country. So exactly what did people think would happen one day anyway ? We shouldn't be surprised.

And it's not just cars.

No, that was not "for the sake of green."

The US began openly "evolving beyond a production economy" back during the Reagan era, and Reagan wasn't green. Offshoring production had nothing to do with ecology, it was all about the Benjamins.

 

[RDKirk]

Both Biden and Congress are looking at this. I’m not sure they’re doing enough, there are recent rules raising the amount of domestic content for products purchased by the US government. As noted, there has been some recent increase in investment in chip making here. But it seems that most people want things as cheap as possible.

I don't know about that. What I recall is that companies moved manufacturing offshore to increase profits, not to reduce prices. Consumers never got much choice in buying American or buying Chinese. Things were suddenly just Chinese.

 

[tobyw]

Nothing runs on Intel chips alone. And many things have no Intel chips at all.

Fair enough. I was thinking microchips in general, rather than automotive specifically.

 

[RDKirk]

Fair enough. I was thinking microchips in general, rather than automotive specifically.

Think in terms of electronic components in general, not just microprocessors.