US, Mexico to Cooperate on Semiconductors, Electric Vehicles

US, Mexico to Cooperate on Semiconductors, Electric Vehicles
Workers work inside the clean room of U.S. semiconductor manufacturer SkyWater Technology where computer chips are made, in Bloomington, Minnesota, in April 2022. (SkyWater Technology/Handout via Reuters)
Naveen Athrappully

The United States and Mexico are planning to cooperate on semiconductor and electric vehicle production, according to a White House fact sheet.

Both nations seek to establish a Supply Chain Working Group with the initial focus being on semiconductors and information and communications technology supply chain ecosystems, the Sept. 12 fact sheet states. A Memorandum of Understanding has been signed between the Mexican Ministry of Economy with leading tech firms and manufacturers to “facilitate emerging technologies and workforce development in Mexico.”

Senior officials from the United States and Mexico met in Mexico City on Monday as part of the U.S.–Mexico High-Level Economic Dialogue where the trade discussions took place.

In a joint statement, the officials said that they will be working together on a pilot project to determine the feasibility of near-shoring semiconductor manufacturing inputs.
In January, a report by the U.S. Department of Commerce warned that the country was facing a chronic shortage of semiconductor chips and that a long-term solution was needed to avoid economic and security risks arising from this issue.
In August, President Joe Biden signed the CHIPS legislation to boost domestic research and manufacturing of semiconductors. Washington recently announced that tech companies receiving funding from the $280 billion CHIPS act will be prohibited from establishing advanced facilities in China for a period of 10 years.
At a Sept. 12 press conference, U.S. Secretary of Commerce Gina Raimondo pointed out that the testing, packaging, and assembly industry for semiconductors in China and Taiwan is a $60 billion industry. In North America, the industry is only valued at $3 billion.
“So there is a huge opportunity for growth in North America and job creation just in the semiconductor supply chain,” she said.

Electric Vehicles

Mexico’s Ministry of Foreign Relations has set up a Transport Electrification Working Group in collaboration with academics, industry representatives, and the University of California.

The group will support the transition of American and Mexican automotive industries toward production of electric vehicles, the fact sheet states. Both Mexico and the United States have a shared commitment to making 50 percent of new vehicle sales electric by 2030.

The Biden administration’s push to transition America to use more electric vehicles is a controversial policy that has attracted criticism.

In an interview with NTD, Jerry Simmons, president of the Domestic Energy Producers Alliance, said that he was shocked at how much taxpayer money Washington is pumping into “unreliable renewable sources.”

Simmons pointed to California, which is promoting the use of electric cars while asking people not to charge their electric vehicles because of an energy shortage, something he said is “absurd.”

The California Independent System Operator recently asked citizens to avoid charging electric vehicles as there was a large demand for electricity owing to the heightened use of air conditioners amid a brutal heat wave.