General Motors (GM) has announced a new, first-of-its-kind direct supply agreement for semiconductor wafers, as reported by Electrek.
GM has partnered with GlobalFoundries (GFS) and signed a long-term agreement to give GM an exclusively dedicated capacity corridor for its chip supply. This shows that GM is no longer taking chances this year following the semiconductor shortages they have experienced in the past years.
What Happens With the Agreement?
GFS will manufacture the wafers directly for key GM suppliers to build higher production volumes. Moreover, this will promote better reliability.
Semiconductors are vital in the transition to zero-emission EVs and autonomous driving. EVs need more chips to advanced power capabilities.
It can also be recalled that GM has a target to hit 1 million EV sales by 2025. To do this, semiconductors will play a significant role.
According to Bloomberg, GM is in talks with Vale for a stake in its nickel and copper mining business. The automaker will also invest $650 million to develop Thacker Pass in Nevada, the largest known supply of lithium in the US.
ting $650 million to develop Thacker Pass in Nevada, which is the largest known supply of lithium in the US.
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Demand for Semiconductors
Indeed, the semiconductor supply chain has eased in the past year due to significant investments allowing the US supply chain to be more stable. However, the demand for semiconductors is expected to increase significantly over the next ten years as EVs and autonomous driving technology become the primary driving means. This means that GM will need to invest heavily in the semiconductor supply chain to ensure that it can achieve its EV sales goals.
This will involve investing in both the production of semiconductors and the research and development of new technologies and components used in EVs. Additionally, GM will need to have a secure supply chain of semiconductors to ensure that a lack of parts does not hamper its EV production.
Overall, it's clear that semiconductors play an integral role in helping GM achieve its ambitious goals around EV production over the next few years - from ensuring there's enough supply available through secure partnerships all while continuing research into new components needed for future generations of EVs or even fully automated ones if these ever become a reality!
Given the importance of the semiconductor supply chain for GM, it is likely that the automaker will continue to invest heavily in this sector to ensure that it can remain competitive in the EV market.
This includes investing in the production of semiconductors, research and development of new technologies and components, and securing reliable supply chains. Additionally, GM is likely to continue exploring investments in mining operations, such as its recent deal with Vale, to ensure that it has access to the necessary minerals needed to produce semiconductors.
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