BMW has struck a deal with chip suppliers Inova and GlobalFoundries to secure a steady supply of semiconductors to allow for long-term production as global shortages continue to put a strain on automakers.
A steady supply of chips is essential for the development of the BMW iX, which launched last month. Credit: BMW Group
The deal should supply the German carmaker with million of microchips a year, essential in the development of electronic devices central to the electrification of the automotive industry.
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The deal will be crucial for BMW to continue to pump out new electric models, including its new BMW iX, of which the first orders were shipped in November.
The company expects around half of its European sales to be EVs by 2030, when countries such as the UK are set to instigate petrol and diesel bans.
Semiconductors serve various functions by performing arithmetic and control tasks in computers, storing data or even handling multiple tasks at the same time. The share of electronic components in vehicles is likely to increase further in the future.
“We are deepening our partnership with suppliers at key points in the supplier network and synchronising our capacity planning directly with semiconductor manufacturers and developers. This improves planning reliability and transparency around the volumes needed for everyone involved and secures our needs for the long term,” says BMW board member Andreas Wendt.
The agreement is an example of the commitment to build a more resilient supply chain partnership approach to regain supply-demand balance for chips in the automotive industry as well as efforts to further accelerate technology innovation.
“This agreement directly with an OEM certainly marks new territory for us as a semiconductor manufacturer,” says Robert Kraus, CEO of INOVA Semiconductors.
“This supply assurance agreement with the BMW Group and INOVA demonstrates how the companies are partnering to develop innovative smart LED technology for the new BMW iX and to develop new technologies for the car of tomorrow", GlobalFoundries Senior Vice President said.
He affirmed that GlobalFoundries is committed to building stronger relationships with the automotive industry to deliver innovation and address the growing demand for feature-rich chips.
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