Exclusive: car prices are soaring. Elizabeth Warren blames corporate greed

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The world is in the midst of an epic shortage of computer chips, largely due to the Covid epidemics and skyrocketing demand. The chip shortage has forced Ford (F), General Motors and other automakers to cut production. Car dealerships don’t have enough new vehicles to meet demand, triggering a wave of shocks on new and used car stickers.

Warren, in a new letter obtained by CNN, argues that the chip shortage, along with its consequences, is a prime example of how real people can be hurt when a few companies become too dominant in their fields. The Massachusetts Democrat points out that only five companies control 54% of the world’s semiconductor manufacturing, which gives the biggest players “immense market power”.

“This market concentration has reduced competition, allowing giant companies to offer huge returns to shareholders,” Warren wrote in a letter sent Thursday to Commerce Secretary Gina Raimondo. “But it has hurt consumers by allowing these dominant companies to raise prices and underinvest in key capabilities, which also has the effect of reducing innovation and product quality.

The Semiconductor Industry Association responded in a statement to CNN, saying the trade group agreed with Warren that America should encourage more domestic chipmaking, but rejected the senator’s other points.

“Some of the senator’s other claims are simply irrelevant,” the trade group said. “The semiconductor industry is one of the most competitive, innovative and economical industries in the world, revolutionizing entire segments of the economy and dramatically improving our way of life. “

This is a developing story.

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