Raphael Stevens

In this articleFGeneral Motors employees work on the assembly line at Fairfax Assembly & Stamping Plant in Kansas City, Kansas.Jim Barcus for General MotorsClarence E. Brown has experienced union strikes, plant shutdowns and layoffs due to parts shortages during his 47 years working for General Motors.But Brown, president of a United Auto Workers local chapter in Kansas, describes the ongoing semiconductor chip shortage that’s costing automakers billions and forcing massive temporary layoffs as more “disappointing” than previous work stoppages, because he feels it could have been avoided.”I’m not a corporate multibillionaire, but it doesn’t take a rocket scientist to know that there’s something wrong with this,” he told CNBC. “I’ve been with General Motors for over 40 some years, and in all 40 some years, they’ve taught me one thing: Where is ‘Plan B’? If ‘A’ is not working, where is ‘Plan B?’ Something has to be done so this will never happen again.”The White House held a virtual CEO Summit on Monday where President Joe Biden met with executives from the auto, tech, biotech and consumer electronics industries to discuss the chip shortage. Participants included CEOs Mary Barra of GM, Jim Farley of Ford Motor and Intel’s Pat Gelsinger.After the meeting, GM, Stellantis and a lobbying group for the Detroit automakers issued statements saying they were grateful the Biden administration held the meeting and was making the issue a priority. They said they looked forward to working Biden to resolve the shortage. Gelsinger told Reuters on Monday that Intel is in talks to start producing chips for carmakers within six to nine months. The Detroit automakers and Intel did not immediately respond to requests for comment.Auto executives started warning of a chip shortage late last year. Those warnings quickly turned into temporary plant closures for the auto industry, causing automakers to temporarily layoff tens of thousands of U.S. autoworkers for varying periods of time since the beginning of the year. Brown’s roughly 2,000 hourly workers at GM’s Fairfax Assembly plant were among the first to lose work when the factory was idled by GM in early February due to the parts shortage.”I just hope that those people in charge, including the president, can come up with a plan so that this won’t happen again,” said Brown, who met Biden during a campaign visit to the plant in 2019. “It’s not just a General Motors or Ford or car thing. This has affected other areas of this country as well.”But experts and company officials say there’s little to nothing Biden can do to force chipmakers, a majority of which are in Asia, specifically Taiwan, to allocate more to the U.S. automotive industry. Biden could try to pressure them. He has also backed proposals for tax incentives to U.S. manufacturers to make the critical parts in America to avoid future shortages. “One of our hopes would be that we could come out of the meeting with a path and a road map to getting back to fulfilling 100% of automotive semiconductor orders and have some real insight and transparency into what that timeline might look like,” said Matt Blunt, president of the American Automotive Policy Council, which represents GM, Ford and Stellantis NV.Blunt, the former governor of Missouri, said producing more semiconductors domestically is a bipartisan issue due to the “significant impact the auto industry has on the U.S. economy and the significant negative implications of this semiconductor shortage.”Consulting firm AlixPartners expects the shortage will cost the global auto industry at least $60.6 billion in 2021.Under Biden’s $2 trillion infrastructure proposal unveiled earlier this month, $50 billion was for the American semiconductor industry. On Feb. 24, he also ordered a 100-day review of U.S. supply chains for advanced batteries, pharmaceuticals, critical minerals and semiconductors.Semiconductors have extremely long production schedules and shipping times due to the amount of materials and parts used in the chips. Only about 12% of them are produced in the U.S., according to officials.’Critical inflection point’Semiconductors are key components in automotive used in infotainment, power steering and braking systems, among other things. As multiple plants shuttered last year due to Covid, suppliers directed semiconductors away from automakers to other industries, creating a shortage after consumer demand snapped back stronger than expected. The parts can contain several different sizes and types of chips.Tom Quillin, Intel senior director for security and trust policy, said last week the tech giant “sees America at a critical inflection point” regarding semiconductor production — not just for automotive, but for the technology industry as well.U.S. President Joe Biden signs an executive order, aimed at addressing a global semiconductor chip shortage, as Vice President Kamala Harris stands by in the State Dining Room at the White House in Washington, February 24, 2021.Jonathan Ernst | Reuters”How the U.S. government invests in the semiconductor industry likely will determine the future of domestic technology innovation and U.S. global leadership,” he said during the virtual discussion Thursday on the CHIPS for America Act hosted by the Department of Commerce.The three-hour forum included tech executives as well as leaders from smaller companies and policy groups, among them Blunt and John Bozzella, CEO of the Alliance for Automotive Innovation, which represents the vast majority of automakers with operations in the U.S.Bozzella urged the Biden administration to adopt policies that encourage U.S. manufacturers to build semiconductors in the U.S., including a investment tax credit that could “help companies offset the cost of creating new lines within existing facilities or reallocating current production to meet evolving needs.”Low priorityThere is a myriad of reasons why automakers aren’t the top priority for chip manufacturers. First off, the auto industry only accounts for 5% or less of the global usage of chips, according to officials. Many of the chips the industry uses are older, or “legacy,” products that many companies aren’t willing to invest in to produce. They instead focus on more advanced semiconductors for tech and consumer products.Michael Hogan, a senior vice president of chipmaker GlobalFoundries, which is scheduled to take part in Monday’s meeting with the Biden administration, said those chips still compete with consumer products for supply at “multiple levels in the supply chain” even though they are older.This photo shows Ford 2018 and 2019 F-150 trucks on the assembly line at the Ford Motor Company’s Rouge Complex on September 27, 2018 in Dearborn, Michigan.Jeff Kowalsky | AFP | Getty Images”These times today are unprecedented, extremely difficult but I think ironically offer the brightest possible prospects for the industry and the country if we act now and move boldly in funding the CHIPS Act,” he said during the forum last week.Depending on the vehicle and its options, experts say a vehicle could have hundreds of semiconductors. Higher-priced vehicles with advanced safety and infotainment systems have far more than a base model, including different types of chips.Automakers have been prioritizing assembly of more profitable vehicles such as full-size pickups by cutting production of cars and crossovers. The Detroit automakers are even partially building pickups to complete and ship at a later date.The shortage has caused significant price and demand increases in 2021, according to Smith & Associates, a Houston-based independent distributor of electronic components. Some open market prices have risen five to 20 times higher this year, according to the company.”Automotive semiconductor demand has been on a steady rise since the beginning of the year,” said Marc Barnhill, Smith’s chief trading officer. “Smith’s market intelligence data now points to even further exacerbation of lead time and demand increases. There has never been an automotive semiconductor shortage quite like this, and it’s not close to being over.”Auto impactAutomotive executives have characterized the chip shortage as fluid. GM, Ford and others have said the shortage will cut billions off their earnings in 2021.Auto research firm LMC Automotive predicts the global automotive industry will produce 811,000 fewer vehicles this year, including 175,000 in North America, as a result. The forecast takes into account much of a nearly 1.4 million decline in global vehicle production during first quarter that is projected to be made up in the second half of the year.”The industry is facing a really different environment than it has in quite a long time,” said Jeff Schuster, LMC president of the Americas and global vehicle forecasting. “We’ve said that a few different times for different reasons, but this one’s unique because they can’t build what they would like to, and what they could sell. That’s going to likely carry into 2022.”GM expects the problem will reduce its operating profit by $1.5 billion to $2 billion this year, while Ford said the situation could lower its earnings by $1 billion to $2.5 billion in 2021.The financial impact of the shortage isn’t lost on Brown, president of the UAW Local 31 in Kansas. But his members, like many manufacturing workers, just want to get back to work building the Chevrolet Malibu and Cadillac XT4.”At this local, we have stuck together during the difficult times and we’re sticking together now,” he said.  “I just hope and pray that the shortage is over as soon as possible … and I’d like to think after this we have more of those jobs in the United States to make sure if something happens, we’ll be able to cover ourselves.” – CNBC’s Michael Bloom contributed to this report. More

In this articleCMGDPZDomino’s Pizza’s newest deliverer isn’t a person — it’s a self-driving car.The restaurant company said Monday that an autonomous car made by Nuro will start delivering pizzas in Houston this week as part of a pilot program.Customers will have to place a prepaid order on Domino’s website for delivery from the chain’s Woodland Heights location. If their order falls within certain days and times, they can choose to have Nuro’s R2 robot drop off their pizza. Once the robot arrives, customers will enter a unique PIN on its touch screen to prompt the doors to open so they can retrieve their pizza.A Domino’s spokeswoman said the company doesn’t have an end date for the pilot program yet.The R2 robot is the first completely autonomous on-road delivery vehicle without any occupants to receive regulatory approval from the U.S. Department of Transportation. Nuro, which was founded by two former members of Google’s self-driving car team, raised $500 million in its last funding round, which included an investment from Chipotle Mexican Grill.Over the last decade, Domino’s has invested in technology to make ordering and receiving a pizza faster and easier, helping it lure customers away from independent pizzerias and other chains, such as Papa John’s. Driverless pizza delivery is one area of recent focus, although the company is still years — or even decades — away from replacing its entire fleet of drivers.In 2019, the company announced its partnership with Nuro. Two years before, it researched how consumers would react to pizza delivery by an autonomous car from Ford.Domino’s shares have risen 13% in the last year, giving it a market value of $15.2 billion. The company has benefited from consumers’ desire for delivery during the coronavirus pandemic, but analysts are concerned about pizza fatigue in the coming months. More

Michigan Governor Gretchen Whitmer receives a dose of the Pfizer Covid vaccine at Ford Field during an event to promote and encourage Michigan residents to get the vaccine on April 6, 2021 in Detroit, Michigan.Matthew Hatcher | Getty ImagesA top Biden administration health official said Monday that Michigan should “shut things down” as it grapples with an overwhelming surge in coronavirus cases.Centers for Disease Control and Prevention Director Rochelle Walensky said a boost in Covid-19 vaccinations alone isn’t the answer — even as Michigan Gov. Gretchen Whitmer calls on the federal government to send more vaccines her way.”I think if we try to vaccinate our way out of what is happening in Michigan, we would be disappointed that it took so long for the vaccine to work, to actually have the impact,” Walensky said during a White House briefing on the pandemic. It takes several weeks for immunizations to kick in and reduce the caseload, she noted.CNBC Health & Science Read CNBC’s latest coverage of the Covid pandemic:CDC chief says Michigan should ‘shut things down,’ vaccinating alone won’t stop Covid surgeWHO says Covid pandemic is growing ‘exponentially’ at more than 4.4 million new cases a weekIndia overtakes Brazil to become the second-worst hit country as Covid cases soarU.S. hits daily vaccination record over the weekend as case counts reach summer peaksThe state’s best bet, Walensky said, “is to really close things down.”Walensky called on Michigan “to go back to where we were last spring, last summer and to shut things down, to flatten the curve, to decrease contact with one another” and to ramp up testing and contact tracing efforts. Cases in Michigan have dramatically risen in recent weeks, averaging 7,359 new cases per day over the last week and approaching its pandemic highs set around Thanksgiving, according to data compiled by Johns Hopkins University. Deaths are also on the rise.”Really what we need to do in those situations is shut things down,” Walensky said.Whitmer, a Democrat in a politically purple state where shutdowns have been especially controversial, has been reluctant to order new restrictions in response to the most recent surge in cases.Last week, she asked residents in her state to voluntarily limit their activities and urged schools to temporarily halt in-person learning. But she stressed that “to be very clear, these are not orders, mandates or requirements.”No state is recording more daily infections on a per capita basis than Michigan, according to a CNBC analysis of Johns Hopkins University data. Much of the current surge stems from a highly infectious variant of Covid, B.1.1.7, which is now the most common strain of the virus in the U.S.Whitmer on Friday called on President Joe Biden’s administration to flood her state with vaccines, going so far as to urge the government to “create a vaccination surge program to help states like Michigan.” The administration is reportedly willing to rush some resources to the state, but not vaccines.Walensky, without addressing Whitmer directly, pushed back on the calls for shipping extra vaccines out to states with severe outbreaks.”There are different tools that we can use for different periods” of an outbreak, Walensky said at Monday’s briefing.”We know that if vaccines go in arms today, we will not see an effect of those vaccines, depending on the vaccine, for somewhere between two to six weeks,” she said. “So when you have an acute situation, extraordinary number of cases like we have in Michigan, the answer is not necessarily to give vaccine. In fact, we know that the vaccine will have a delayed response.””Similarly, we need that vaccine in other places,” Walensky said. “If we vaccinate today, we will have impact in six weeks, and we don’t know where the next place is going to be that is going to surge.”— CNBC’s Berkeley Lovelace Jr. contributed to this report. More

In this article.COVID19The number of colleges and universities that will require students be fully vaccinated against Covid-19 is suddenly escalating.In just the last few days, Duke University, Brown, Northeastern University, the University of Notre Dame, Syracuse University and Ithaca College all announced that students returning to campus in the fall must be fully vaccinated before the first day of class.Cornell University, Rutgers University, Nova Southeastern University, Roger Williams University in Bristol, Rhode Island, Fort Lewis College in Durango, Colorado, and St. Edward’s University in Austin, Texas, have also said vaccinations will be mandatory for the fall of 2021.More from Personal Finance:Vaccinating kids could slow reopenings, parents group fearsStudy: Virtual school resulted in ‘significant’ learning lossMany schools struggle to reopen for in-person learningEven more institutions are likely to follow, according to Lynn Pasquerella, president of the Association of American Colleges and Universities.”Medical and religious exemptions will be accommodated, but the expectation will be that our campuses and classrooms will overwhelmingly consist of vaccinated individuals, greatly reducing the risk of infection for all,” Cornell President Martha Pollack and Provost Michael Kotlikoff said in a statement.Across the country, campuses struggled to remain open over the last year as fraternities, sororities and off-campus parties drove sudden spikes in coronavirus cases among undergraduates. Meanwhile, students overwhelmingly declared remote school a mediocre substitute for being in the classroom.As eligibility for Covid vaccines expands to people 16 years and older, schools must consider how a vaccine mandate can help higher education get back on track, Pasquerella said.For those enrolled in school, there are many vaccination requirements already in place to prevent the spread of diseases such as polio, diphtheria, tetanus and whooping cough.All 50 states have at least some vaccine mandates for children attending public schools and even those attending private schools and day-care centers. In every case, there are medical exemptions, and in some cases there are religious or philosophical exemptions, as well.”Adding Covid-19 vaccination to our student immunization requirements will help provide a safer and more robust college experience for our students,” Rutgers President Jonathan Holloway said in a statement.At Rutgers, students can also request an exemption from vaccination for medical or religious reasons and students enrolled in fully remote programs will not be required to be vaccinated.And yet, vaccine hesitancy remains a powerful force among parents, in particular.Zoom In IconArrows pointing outwardsOnly 58% of parents or caregivers said they would vaccinate their children against Covid, despite 70% of parents saying they would vaccinate themselves, according to a March poll by ParentsTogether, a national advocacy group.Low-income and minority households were even less likely to vaccinate their children, ParentsTogether found.Other studies have shown Black and Latino people to be more skeptical of the vaccines than the overall U.S. population due to historic mistreatment in medicine. Disparities along racial lines in vaccine distribution also have been observed in the U.S.”Colleges do need to get ahead of this and think about how this is going to play out,” said Bethany Robertson, co-founder and co-director of ParentsTogether.  “We need to start the conversation with parents now, to build trust and understanding about how getting kids vaccinated against Covid-19 protects their health, their family’s health and the health of our communities,” Robertson said.    However, in addition to students, parents and community members, schools must also weigh the interests of the faculty, staff, legislators and boards of trustees, Pasquerella said.”It’s complicated,” she said. “No matter what decision one makes, one group will ultimately be displeased.”  Subscribe to CNBC on YouTube. More

In this articleAAPLActors Will Smith (L) and Antoine Fuqua.Getty Images”Emancipation,” a slave drama directed by Antoine Fuqua and starring Will Smith, will no longer be filmed in the state of Georgia due to a new voting law that was signed there by Gov. Brian Kemp in late March.”At this moment in time, the Nation is coming to terms with its history and is attempting to eliminate vestiges of institutional racism to achieve true racial justice,” said Smith and Fuqua in a joint statement Monday.”We cannot in good conscience provide economic support to a government that enacts regressive voting laws that are designed to restrict voter access,” they said. “The new Georgia voting laws are reminiscent of voting impediments that were passed at the end of Reconstruction to prevent many Americans from voting. Regrettably, we feel compelled to move our film production work from Georgia to another state.”This is the first film to pull its production out of the state because of the legislation.The new law, which includes a restriction on drop boxes, makes it a crime to provide food or water to voters lined up outside polling stations, requires mandatory proof of identity for absentee voting and creates greater legislative control over how elections are run. Opponents say these provisions will disproportionately disenfranchise people of color.Since 2008, enticing tax incentives have turned the state a production hub for film and television, particularly for Netflix, HBO Max, Disney’s slate of Marvel movies and TV shows, and The CW. Georgia has also developed infrastructure for big-budget productions and is home to a tremendously skilled workforce of crew members, craftsmen and technicians.Hollywood has been debating how to handle this most recent Georgia situation. Some have called for a production boycott, while others have worried that pulling out of the state would do more harm than good. For the most part, studios who have commented on the new law have condemned it, but not committed to halting production.”Emancipation,” which Fuqua and Smith are producing for Apple Studios, centers around Whipped Peter, an enslaved person who emancipated himself durng the Civil War from a Southern plantation and joined the Union Army. He is most famous for being the subject of a series of photographs, which show the shockingly brutal scars on his back from being whipped as a slave.It is unclear what the financial toll will be for moving the project’s production out of Georgia, but having Fuqua and Smith, who are both Black and major players in Hollywood and internationally, support the decision could put more pressure on other productions to leave the state. More

In this articlePEPWith Americans stuck at home, snack food has become a valuable commodity for consumers stressed by the Covid pandemic. Frito-Lay, a subsidiary of PepsiCo and one of the largest snack food makers, has seen sales surge. The company produces more than 1,200 different types of snacks, including brands like Cheetos, Doritos, Lay’s, Smartfood and Ruffles.PepsiCo said in February that fourth-quarter net revenue at Frito-Lay North America increased 5% on a year-over-year basis to $5.4 billion. And it’s not just Frito-Lay that is seeing a boom in its snack business.North American sales of savory snacks like chips, popcorn and pretzels climbed to $56.9 billion in 2020, an 11% increase from the previous year, according to Euromonitor International.”The snacking industry was kind of growing low-to-mid single digits, humming right along, and then the pandemic just gave it this explosive growth,” said CFRA analyst Garrett Nelson.In stressful times, people turn to snacking for comfort, and the pandemic has transformed kitchens across the U.S. into giant vending machines. Watch the video above to find out more about Americans’ snacking habits and if Covid-19 has put an end to the shift to healthier snacks.Watch more:Leaving a tip is an American custom. Why that’s a problem How Spirit Airlines can bounce back from Covid-19 More

Dr. Scott Gottlieb said Monday that Americans having digital access to their Covid vaccination status would be helpful in navigating the coronavirus pandemic in the months ahead.In an interview on CNBC’s “Squawk Box,” the former Food and Drug Administration commissioner sought to downplay privacy worries at the heart of opposition to verification requirements.”The whole discussion around vaccine passports has gotten swept up in a lot of concerns around whether or not it’s going to be used to limit people’s access to things that they would otherwise do,” said Gottlieb, a board member of Pfizer, which makes one of the three Covid vaccines cleared for emergency use in the U.S. “The use case for this information is likely to be enabling access to things that are otherwise going to be restricted.”Gottlieb pointed to visitations at nursing homes or hospitals in the fall, when he said he expects to see an uptick in coronavirus cases again. This past winter “nursing homes banned visitors. Hospitals banned visitors,” he said. “You could see a situation where those institutions might allow people to visit if they can demonstrate they’ve been vaccinated.”CNBC Health & Science Read CNBC’s latest coverage of the Covid pandemic:CDC chief says Michigan should ‘shut things down,’ vaccinating alone won’t stop Covid surgeWHO says Covid pandemic is growing ‘exponentially’ at more than 4.4 million new cases a weekIndia overtakes Brazil to become the second-worst hit country as Covid cases soarU.S. hits daily vaccination record over the weekend as case counts reach summer peaksInformation on administered Covid vaccines is being entered into the same system used by the Centers for Disease Control and Prevention to track pediatric vaccinations, Gottlieb said. “The problem with the system is it was never designed really to be accessible to consumers, so consumers really have no way right now to get the information to prove they’ve been vaccinated.”The paper cards from the CDC people currently receive when getting their Covid shots are unlikely to cut it, either, he said. “Those are available on eBay right now … so people aren’t going to accept the cards as proof of vaccination.”That’s why digital documentation of Covid vaccine status should be available to Americans, he said. “How they choose to use it is up to them,” said Gottlieb who was FDA chief from 2017 to 2019 in the Trump administration.Efforts to develop digital Covid vaccine records are underway, including a high-profile group backed by Microsoft and the Mayo Clinic known as the Vaccination Credential Initiative. The coalition said earlier this month it hopes to make the technology it develops available in May.IBM is working with New York state on a digital health pass that uses blockchain technology to verify a person’s test or vaccine credentials. Walmart, which is carrying out shots in its stores, recently backed calls for vaccine certificates.The debate around so-called vaccine passports has grown contentious, as some critics raise civil liberty concerns. In Florida, for example, Republican Gov. Ron DeSantis signed an executive order this month that prevents businesses from requiring a person to offer show they’ve received a Covid vaccine as a prerequisite for service.Last week, the Biden administration ruled out vaccine passports at the federal level. White House press secretary Jen Psaki said Tuesday: “There will be no federal vaccinations database and no federal mandate requiring everyone to obtain a single vaccination credential.”Gottlieb said, “in certain limited circumstances,” he anticipates people needing to demonstrate they have been immunized against Covid. “So, I think people need to think about this differently,” he added. “Right now, as consumers, we don’t own this information, and we should.”Disclosure: Scott Gottlieb is a CNBC contributor and is a member of the boards of Pfizer, genetic testing start-up Tempus, health-care tech company Aetion Inc. and biotech company Illumina. He also serves as co-chair of Norwegian Cruise Line Holdings′ and Royal Caribbean’s “Healthy Sail Panel.” The Associated Press contributed to this report. More