Ford is looking to source its chips locally to address the ongoing global chip shortage. The company announced Thursday that it had signed an agreement with chip manufacturer Global Foundries to boost its supply. Meanwhile, GM is also looking for ways to address the shortage by looking to other suppliers.
Ford said it had signed a non-binding agreement with Global Foundries, which will involve a collaborative effort in researching and developing chips that are vital to producing its future vehicle models. This will include chips that are used for key systems such as battery management and self-driving.
Ford and Global Foundries did not provide any specific details on the arrangement, including whether Ford would provide cash or other commitments to reserve capacity at any of Global Foundries' present or future plants. The two did say that there would be no cross-ownership between them as part of the strategic partnership.
Global Foundries, which is majority controlled by Abu Dhabi's sovereign wealth fund, went public this year in a $26 billion initial public offering. The company previously announced that part of the funds would be used to establish a second chip facility in Malta, New York.
The global semiconductor shortage has forced Ford and other automakers to reduce vehicle output during the last year. The majority of businesses have allocated their chips to their most profitable cars. As a result, manufacturers are looking for ways to improve chip access.
A number of chip producers and foundries are making a strong push to manufacture components locally in order to take advantage of different government incentives. However, analysts estimate that a move to produce chips domestically may still be years away.
Ford said in its press release that they are not committing to building any new chip factories any time soon. Instead, the company is looking to expand existing semiconductor manufacturing facilities.
In a separate event on Thursday, GM CEO Mark Reuss said the company is looking at similar opportunities - including the co-developing of new chips with partners such as TSMC, Qualcomm, and other major chipmakers.
Ford's VP of vehicle embedded software and controls, Chuck Gray, said there are a lot of things companies can do to address the issue. He said Ford is currently also looking into bringing in experts in silicon and chip design. Gray said having in-house software, and chip design knowledge will help the company develop software with chips that are available or those supplied by other manufacturers.