By Nina Kienle
Continental said it has partnered with semiconductor company GlobalFoundries to design its own computer chips for vehicles.
The German car-parts company said Monday that the new organization will be named Advanced Electronics and Semiconductor Solutions, or AESS.
AESS will be responsible for designing and testing specialized computer chips tailored for the electronic systems and technologies integrated into its spinoff Aumovio's future automotive products, the company said.
While AESS will focus on design, manufacturing will be handled exclusively by GlobalFoundries, it added. Financial details weren't disclosed.
"The creation of this fabless semiconductor unit will strengthen Continental's position not only by reducing geopolitical risks, but also by the way of becoming more self-reliant in this field," Chief Executive Philipp von Hirschheydt said.
The initiative comes amid rapidly escalating demand for semiconductors within the automotive industry, particularly for enhancing the electronic content in software-defined vehicles.
Features like lane-keeping assistance, adaptive cruise control and collision detection rely on sophisticated semiconductors.
Continental highlighted the burgeoning global automotive semiconductor market, projected to reach approximately 110 billion euros ($126.77 billion) by 2032.
It is therefore imperative for organizations to invest in semiconductor development to be successful in the long run, the company said.
Continental said the establishment of AESS directly aligns with the board's long-term strategy of investing in technology and boosting self-sufficiency.
Beyond self-reliance, the initiative is designed to foster a more resilient supply chain, improve product quality, and significantly reduce time to market, it added.
The company anticipates the new organization will generate value through operational efficiencies, cost savings and an enhancement of overall cash flow.
Write to Nina Kienle at nina.kienle@wsj.com
(END) Dow Jones Newswires
June 23, 2025 07:22 ET (11:22 GMT)
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