US

Exclusive: Car prices are surging. Elizabeth Warren blames corporate greed

The world is in the midst of an epic computer chip shortage, one largely driven by Covid outbreaks and skyrocketing demand.
The chip shortage has forced Ford (F), General Motors and other auto companies to slash their production. Car dealerships don’t have enough new vehicles to meet demand, setting off a wave of new and used car sticker shock.

Warren, in a new letter obtained by CNN, argues that the chip shortage, along with its aftermath, is a prime example of how real people can get hurt when a few companies become too dominant in their fields. The Massachusetts Democrat points out that just five firms control 54% of global semiconductor manufacturing, giving the biggest players “immense market power.”

“This market concentration has reduced competition, allowing giant corporations to deliver massive returns for shareholders,” Warren wrote in a letter sent Thursday to Commerce Secretary Gina Raimondo. “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.

The Semiconductor Industry Association responded in a statement to CNN by saying the trade group agrees with Warren that America needs to encourage greater domestic chip making, but it pushed back on the senator’s other points.

Some of the Senator’s other assertions are simply wide of the mark,” the trade group said. “The semiconductor industry is one of the world’s most fiercely competitive, innovative, and economically impactful sectors, revolutionizing entire segments of the economy and dramatically improving our way of life.”

This is a developing story.


Source link

Related Articles

Back to top button