GM to team up with semiconductor producers

General Motors (GM) president Mark Reuss said on Thursday the company will co-develop semiconductors with several producers to make chips that can handle more electronic features in its vehicles, a revamp of strategy that comes as a shortage of these items continues to roil the global auto industry.

GM uses a wide assortment of semiconductors in its cars. It now plans to reduce the types of chips it uses to just three families of semiconductors over the next several years. That would reduce the variety of chips GM orders by 95%, making it easier for producers to fulfil the company’s needs and boosting margins, Reuss said at the Barclays Auto Conference. 

He said GM needs to cut down on semiconductor complexity because the rapid increase in hi-tech functions in its new models, along with the company’s rapid push into electric vehicles, means the automaker needs a lot more chips.

“We see the semiconductor requirements more than doubling over the next several years as the vehicles we produce become more of a technology platform,” Reuss said. 

GM will be working to develop the chips with Qualcomm, STMicroelectronics, Taiwan Semiconductor Manufacturing, Renasas Electronics, ON Semiconductor Corporation, NXP Semiconductors and Infineon Technologies, Reuss said.

The Detroit automaker last month reported its third-quarter sales fell 33% and profits were almost half what they were a year ago because of lost production due to a lack of chips. CEO Mary Barra said in October that she expects the semiconductor shortage to last into the second half of 2022.

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