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Chips Act passes in Washington D.C. for semiconductor manufacturing

Around 5,000 unfinished cars remain parked on May 14 outside the Volkswagen Navarra factory in Pamplona, Spain, due to lack of semiconductor supply. Manufacturers all over the world have been struggling to meet surging demand.
Ander Gillenea
/
AFP via Getty Images
Around 5,000 unfinished cars remain parked on May 14 outside the Volkswagen Navarra factory in Pamplona, Spain, due to lack of semiconductor supply. Manufacturers all over the world have been struggling to meet surging demand.

Legislation in Washington D.C. to boost U.S. semiconductor manufacturing passed a vote in the Senate today. A final vote to make the bill a law is expected this week.

While the bill includes more than $50 billion in government incentives, it may not have an impact right away. The factories that make microchips can take two years to bring online. But Michigan Senator Gary Peters says that doesn't mean the legislation won't have an impact long-term.

"This problem only gets bigger as time goes on. If we look at where the future of the auto industry is, we know the auto industry is moving towards electric vehicles. Electric vehicles require more chips," he says.

In the meantime, Detroit's car companies are still having a hard time finding semiconductors. In its second-quarter earnings call, General Motors said supply chain issues were a reason behind its 40% profit loss from April through June.

Alex McLenon is a Reporter with 101.9 WDET.