Over the past year, you may have noticed smart devices have seemingly become harder to acquire due to short supply or limited availability. This is down to high demand and the shortage of semiconductors — computer chips used in millions of todays products like washing machines, smartphones, gaming consoles and of course, cars. In short, there just aren’t enough enough of them to meet industry demand.
On the automotive end this has resulted in some manufactures either slowing or halting production at their factories, in turn creating an unprecedented shortage in the supply of new vehicles with current waiting times for delivery of some technology laden or in-demand models varying from six months to over a year.
Having faced a challenging year of production due to COVID, and with the latest Omicron variant threatening uncertainty for the year ahead, the BMW Group has partnered with high-tech microchip developer INOVA Semiconductors and GlobalFoundries to guarantee the direct supply of several million microchips per year for the long term.
The microchips will be used in Intelligent Smart Embedded LED (ISELED) co-developed by the BMW Group, which will be deployed for the first time in the BMW iX and rolled out in further models. This supply assurance agreement also demonstrates how the companies are working together to develop innovative smart LED technology not only for the new BMW iX and ‘i’ range, but are also developing new technologies for the car of tomorrow.
“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” said Dr Andreas Wendt, member of the Board of Management of BMW AG responsible for Purchasing and Supplier Network.
This 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.