Automotive industry

Automotive industry launches new semiconductor sourcing model

Another interesting change is underway after systems companies like Google and Tesla ventured to develop their own chips in the 2010s. ” partner with factories and semiconductor suppliers to create strategic partnerships that will secure long-term supply of chips.

It is obvious from BMW’s merger with GlobalFoundries and chip developer Inova Semiconductors for a multi-year supply of smart LED chips in the BMW iX line of cars. Smart Integrated LED (ISELED) designs will use these automotive grade chips in iX models.

Source: ISELED

This new model, which aims to build a more resilient supply-chain partnership, will guarantee the supply of several million chips each year. Inova CEO Robert Kraus recognizes that this model of working directly with OEMs is new territory for semiconductor companies. “This will ensure a high degree of planning security with the long production cycles of the chips. “

In addition to the recent shortage of integrated circuits, it is evident that the share of electronic components in vehicles is likely to increase further in the future. So GlobalFoundries, among other fabs, wants to reverse this trend by building stronger relationships with the automotive industry. Earlier in November, the fab signed a similar deal chip supply pact with Ford.

Ford CEO Jim Farley called the strategic collaboration the start of a plan to vertically integrate key technologies and capabilities for ADAS, battery management systems and on-board networks. Here, GlobalFoundries will create additional manufacturing capacity to ensure the supply of automotive grade chips for Ford vehicles.

These two announcements mark a shift in the semiconductor supply chain, where factories are playing a more proactive role. Add to that General Motor’s vow to reduce the number of unique MCUs in its vehicles, and you can feel a continuing disruption of semiconductors in the auto industry.

Much has been written and said about chip shortages and their impact on the auto industry; now, this is how automakers are reacting by approaching the semiconductor industry. Beyond the shortage of integrated circuits, what bothers automakers is that the use of semiconductors in vehicles is growing to perform arithmetic and control tasks in computing, data storage or even managing multiple tasks simultaneously.

At a recent tech conference, GM’s Mark Reuss said semiconductor needs will more than double in the next few years. GM, for its part, works closely with top TSMC chipmakers and major chip suppliers like Infineon, NXP, onsemi, Qualcomm, Renesas, and STMicroelectronics.

Ultimately, the year 2022 will show how the relationship of chipmakers with automakers evolves and how this affects the semiconductor supply chain.

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