Ford (F) - Get Ford Motor Company Report and GlobalFoundries (GFS) - Get GlobalFoundries Inc. Report are working together to increase the chip supply. On Thursday, the two companies announced that they have signed a non-binding agreement, aiming to boost chip supplies.
“It’s critical that we create new ways of working with suppliers to give Ford – and America – greater independence in delivering the technologies and features our customers will most value in the future,” said Ford CEO Jim Farley. “This agreement is just the beginning, and a key part of our plan to vertically integrate key technologies and capabilities that will differentiate Ford far into the future.”
They said that this collaboration does not involve cross-ownership between the two companies.
“GF is committed to building innovative alliances with the world’s leading companies to enable the features in products that are pervasive throughout people’s lives,” said GlobalFoundries CEO Tom Caulfield. “Our agreement with Ford is a key step forward in strengthening our cooperation and partnership with automakers to spur innovation, bring new features to market faster, and ensure long-term, supply-demand balance.”
The chip shortage has been a major headache for automakers. Companies like Ford and General Motors (GM) - Get General Motors Company Report have already slashed their production due to the chip shortage.
In September, the White House sat down with tech and auto giants to discuss the chip shortage.
A recent study from AlixPartners suggests that in 2021 the semiconductor chip shortage would cost the global auto industry $210 billion in revenue.