After Halting Vehicle Production and Closing Factories in Brazil, Ford Enters Chip Market to Enhance Competition and Resolve Production Crisis in the Automotive Industry

Written by Flavia Marinho

Published on 22/11/2021 at 09:35

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Ford Chief Says Initiative Represents “Just The Beginning” Of The Business And Is Part Of The Company’s Supply Chain Strategy To End Production Crisis.

After halting vehicle production and closing factories in Brazil in recent months, Ford had to significantly reduce its output, resulting in million-dollar economic losses, due to the semiconductor chip shortage that triggered a crisis affecting numerous companies across various sectors of technology.

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To resolve this problem, Ford Motors announced a strategic agreement with GlobalFoundries (GF), a company dedicated to the design and production of semiconductors. This way, it is expected to secure chip supply while presenting the opportunity to design exclusive chips for the automaker.

Ford’s President and CEO, Jim Farley, stated in a release that the supply agreement with GF, based in New York, represents “just the beginning” of the business and is part of the company’s plan to “vertically integrate key technologies and capabilities,” although this announcement does not reveal financial details or the date when GlobalFoundries would start supplying semiconductor chips to the automaker. These chips would be used for advanced driver assistance, battery management, and network systems.

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The Shortage Did Not Just Affect Ford

Far from being a problem of a single company, the chip shortage has generated consequences for numerous businesses and has prompted different sectors to take action on the matter. Similarly, so far this year, U.S. President Joe Biden has announced measures to increase semiconductor chip production in that country.

According to a report published in September by the consulting firm AlixPartners, the chip shortage worsened by the pandemic will cost the automotive sector about $210 billion globally and will result in 7.7 million fewer vehicles being produced than expected. In light of this scenario, the demand for components becomes increasingly urgent, and the measures taken are a viable solution, but the recovery of the sector will be slow, which according to the firm, will not be seen until at least the second quarter of next year and “will likely extend a bit longer.”

After Halting Vehicle Production and Closing Factories in Brazil, Ford Enters Chip Market to Enhance Competition and Resolve Production Crisis in the Automotive Industry

Ford Chief Says Initiative Represents “Just The Beginning” Of The Business And Is Part Of The Company’s Supply Chain Strategy To End Production Crisis.

Read Also

The Shortage Did Not Just Affect Ford

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After Halting Vehicle Production and Closing Factories in Brazil, Ford Enters Chip Market to Enhance Competition and Resolve Production Crisis in the Automotive Industry

Ford Chief Says Initiative Represents “Just The Beginning” Of The Business And Is Part Of The Company’s Supply Chain Strategy To End Production Crisis.

Read Also

The Shortage Did Not Just Affect Ford

Seen from space, an image taken by an astronaut shows an unlikely oasis in the Saudi Arabian desert, protected by a terrain that slows the advance of sand, surrounded by green circles, remnants of an extinct lake and nearly 10,000 years of preserved history.

While the U.S. still faces limitations in deep space, China is developing unprecedented technology with strategic satellites that maintain communication with the far side of the Moon and aims for dominance by 2030.

In Botswana, a salt flat of up to 16,000 km² that was once an African megalake spends months as an absolute white desert, but during the rainy season it transforms into a shallow sea that reappears from nowhere and can be seen from space in the middle of southern Africa.

The Blood Falls of Antarctica hide a living ecosystem trapped under the ice for over 2 million years, where microbes survive without light, without oxygen, and without ever having seen the Sun.

Bavarian archaeologists unearthed a medieval skeleton that had an articulated iron hand in place of its left arm, and the discovery reveals that doctors were already creating sophisticated prosthetics over 500 years ago.

The CEO of Honor in Spain says that smartphones will change with AI, foldables, and even robot phones; the component crisis is making cheap models more expensive in 2026 and shifting the focus to premium.

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