Sen. Elizabeth Warren has claimed corporate greed is responsible for a global chip shortage that has pushed the price of cars to eye-popping levels.
“[M]arket concentration has reduced competition, allowing giant corporations to deliver massive returns for shareholders,” Warren (D-Mass.) argued in a Thursday letter to Commerce Secretary Gina Raimondo, according to a CNN Business report.
“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,” Warren added.
The senator went on to note that five manufacturers control 54 percent of the global semiconductor market and argued that those conditions create a near-monopoly, allowing companies to jack up prices.
As semiconductor chips become harder to find, major car companies like Ford and General Motors have had to reduce the number of cars they manufacture and raise prices accordingly.
Warren specifically called out Taiwan Semiconductor Manufacturing Co., which sells to major tech companies including Apple and Nvidia, as well as “cutting-edge” chip maker ASML.
“So while dominant semiconductor companies like TSMC and ASML post massive profits and reward shareholders,” she wrote, “consumers are harmed by shortages and higher prices.”
While Warren blamed corporations for the chip shortage, others point to external factors like COVID-19 and global supply chain issues.
Last year Congress passed the CHIPS Act, which aims to increase domestic manufacturing of computer chips — just 12 percent of which were made in the US as of 2020.
Warren has been on the anti-corporate warpath of late. Last week, she wrote a letter calling out car rental company Hertz for spending money on share buybacks while raising the price of vehicle rentals.
