For the better part of the last two years, a shortage of semiconductor has hobbled the automotive industry, limiting the amount of new cars companies can produce and lowering sales around the world. Now, GM has announced a strategic, long-term agreement with GlobalFoundries to supply semiconductors from up state New York.
“We see our semiconductor requirements more than doubling over the next several years as vehicles become technology platforms,” said Doug Parks, GM executive vice president of Global Product Development, Purchasing and Supply Chain. “The supply agreement with GlobalFoundries will help establish a strong, resilient supply of critical technology in the U.S. that will help GM meet this demand, while delivering new technology and features to our customers.”
As part of the deal, which GM describes as a first-of-its-kind agreement, GlobalFoundries will supply the automaker’s chipmakers with advanced semiconductors. That will allow the automaker’s suppliers to produce chips at higher volumes.
The semiconductors GF manufactures will also help reduce the use of unique chips in GM’s vehicles, which should improve the reliability and predictability of its supply chain. Only expected to become more important to the automotive sector in the coming years, these chips will facilitate the rollout of electric vehicles, advanced driver assistant features, connectivity, and even fully autonomous vehicles.
“At GF, we are committed to working with our customers in new and innovative ways to best address the challenges of today’s global supply chains,” said Dr. Thomas Caulfield, president and CEO of GF. “GF will expand its production capabilities exclusively for GM’s supply chain, enabling us to strengthen our partnership with the automotive industry and New York State, while further accelerating automotive innovation with U.S.-based manufacturing for a more resilient supply chain.”
