Yahoo Finance Intel offers up factories to ease chip shortage
Intel is in talks with car makers to quickly produce bulk orders of computer chips within the next nine months in an attempt to remedy a shortage that has ground production to a halt.
Pat Gelsinger, Intel's chief executive, told officials and business executives at a White House briefing on Monday that his company's new third-party manufacturing division could help relieve the squeeze on the auto industry.
The division, known as Intel Foundry Services, was announced last month as a way to open up Intel's fabrication plants, or “fabs”, to other companies, with the first two facilities to start construction this year in Arizona.
Intel has yet to announce specific car maker customers, but the initial response to the foundry services “has been very positive,” a spokesman said.
Following the briefing, Mr Gelsinger told Reuters: “We’re hoping that some of these things can be alleviated, not requiring a three or four-year factory build, but maybe six months of new products being certified on some of our existing processes.
“We’ve begun those engagements already with some of the key components suppliers.”
Auto executives have called on the US government to step in as they were warned that the chip shortage could continue to affect production for another six months.
According to the Alliance for Auto Innovation, an industry group that represents American car manufacturers, this could mean 1.3m fewer cars being made in the US than in 2020, or around 10pc of all vehicles produced in the US.
The chips are necessary for car entertainment units and power supplies, and are critical in high-tech electric cars made by Tesla.
Companies cancelled orders as the pandemic set in last year, expecting slow production and sales. However, as consumer demand rebound, chipmakers did not have enough to sell, having focused on smartphones and gaming consoles which were expected to continue to be big sellers as people stayed home.
