General Motors Co. has signed a strategic agreement to secure a dedicated supply of chips from an upstate New York supplier.
General Motors Corp.’s (GM) first-of-its-kind agreement with GlobalFoundries (GF) establishes a dedicated capacity corridor exclusively for GM’s chip supply. GF will manufacture semiconductors for GM’s key chip suppliers at GF’s advanced semiconductor facility in Malta N.Y.
This agreement supports GM’s strategy to reduce the number of unique chips needed to power increasingly complex and tech-laden vehicles. The deal means chips can be produced in higher volumes and are expected to offer better quality and predictability.
Semiconductors are the foundation of the technologies that are powering the electrification, autonomous driving and connectivity of the auto industry, and the now famous global chip shortage has hit automakers’ production capacity for years.
“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.”
GF is responding to the global demand for semiconductors through a series of strategic long-term agreements with existing and new customers and simultaneously expanding global capacity to meet customer demand in partnership with federal and local governments. Policies like the bipartisan CHIPS and Science Act are encouraging the onshoring of semiconductor production and reestablishing the U.S. as a global leader of this critical technology.
“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.”