Biden Orders Broad Supply-Chain Review Amid Chip Shortages

By Biography

The tech battle between the U.S. and China has battered TikTok and Huawei and startled American companies that produce and sell in China. WSJ explains how Beijing is pouring money into high-tech chips as it wants to become self-sufficient. Video/Illustration: George Downs/The Wall Street Journal

WASHINGTON—President Biden signed an executive order Wednesday directing a broad review of supply chains for critical materials—from semiconductors to pharmaceuticals and rare-earth minerals—with the aim of spurring domestic production while strengthening ties with allies.

A chip shortage is squeezing auto makers in the U.S. and world-wide, and Biden administration officials have been working with industry to free up supplies. Cars use chips for numerous systems, including engine management, automatic braking and assisted driving.

The executive order mandates a 100-day review of supply chains for four areas: semiconductors, used in products from cars to phones; large-capacity batteries used in electric vehicles; pharmaceuticals and rare-earth elements that are key to technology and defense. Mr. Biden is also calling for a separate, one-year review of supply chains covering six broader sectors, from technology to food production.

“The American people should never face shortages in the goods and services they rely on, whether that’s their car, their prescription medicines or the food at the local grocery store,” Mr. Biden said, at one point holding up a semiconductor. “We need to stop playing catch-up.”

The executive order wouldn’t fix the near-term chip shortage, White House officials acknowledged, but the hope is to produce a longer-term plan to help the federal government prevent future supply-chain problems. They are separately looking for ways to ease the backlog facing U.S. auto makers.