Jeep-and Chrysler-parent Stellantis and iPhone maker Foxconn on Tuesday announced a 50/50 joint venture called SiliconAuto to produce semiconductors for the automotive industry.
The deal is the result of a memorandum of understanding the companies signed in late 2021 as a chip shortage was causing major headaches for automakers.
That picture of supply chain troubles has improved, but it highlighted the need for automakers to secure a reliable supply of semiconductors.
Demand for more capable chips will only be heightened by the industry switch to electric vehicles and the addition of increasingly sophisticated technology inside them.
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“Stellantis will benefit from a robust supply of essential components, which is critical to fueling the rapid, software-defined transformation of our products,” Stellantis Chief Technology Officer Ned Curic said in a news release. “Our goal is to build vehicles that seamlessly connect with our customers’ daily lives and deliver class-leading capabilities years after they leave the assembly line. With this joint venture, we can create purpose-built innovations with an efficient partnership.”
The joint venture, which will begin supplying chips to the two companies and others in 2026, will be based in the Netherlands, just as Stellantis is, according to the release. SiliconAuto’s management team is to include executives from both Stellantis and Foxconn, also known as Hon Hai Technology Group.
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Financial details and the production location were not announced.
Stellantis, which also owns the Ram, Dodge, Fiat and Alfa Romeo brands, and Foxconn also have a joint venture called Mobile Drive “focused on developing smart cockpits enabled by consumer electronics, human-machine interfaces and services,” the release noted.
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