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Stellantis partners with Foxconn to build new semiconductor chips

Explainer Worsening Chip Shortage
Posted at 8:25 AM, Dec 07, 2021

(WXYZ) — Stellantis has partnered with Han Hai Technology Group, also known as Foxconn, to help build semiconductors for the automaker and its third-party customers.

Related: Plan to fix chip shortage stalls in Congress

The two companies announced the non-binding memorandum of understanding on Tuesday morning during Stallntis' Software Day 2021.

“Our software-defined transformation will be powered by great partners across industries and expertise,” Stellantis CEO Carlos Tavares said in a statement. “With Foxconn, we aim to create four new families of chips that will cover over 80% of our semiconductor needs, helping to significantly modernize our components, reduce complexity, and simplify the supply chain. This will also boost our ability to innovate faster and build products and services at a rapid pace.”

It comes amid the ongoing global semiconductor chip shortage that has left new vehicles sitting on lots around the country waiting for chips .

“As a leading global technology company, Foxconn has the depth of experience in manufacturing semiconductors and software - two key components in the production of electric vehicles. We look forward to sharing this expertise with Stellantis and together tackle the long-term supply chain shortages, as we continue with the expansion into the electric vehicle market,” said Young Liu, Chairman & CEO of Foxconn Technology Group.

Stellantis said the partnership will aim to reduce the complexity of semiconductor chip design and offer a family of purpose-built chips that will support Stellantis vehicles.

Last month, Ford Motor Company announced it entered into a strategic collaboration with GlobalFoundries Inc. with the goal of advancing semiconductor chip manufacturing in the U.S. amid the global shortage.

Related: Chip Shortage: What are the short-term and long-term solutions to supply issue?

Both companies signed a non-binding agreement that will allow GlobalFoundries to create semiconductor chips for Ford's current vehicle lineup, and also allow both companies to research ways to address the growing demand for chips in the auto industry.