Mexico and Intel join forces against the semiconductor crisis in the industry

the tech giant Intel and the Mexican government announced an agreement to strengthen the semiconductor supply chain in the country, where shortages of this input cause a crisis in the industry, particularly in the crucial automotive sector.

“We are announcing an agreement that will precisely allow us to strengthen the entire semiconductor supply chain in a country where the greatest commitment we have is our presence for more than 30 years”declared santiago cardonaCEO of Intel Mexico.

Intel promises with this agreement with the Ministry of Economy of the federal government strengthen the competitiveness of Mexican companies in the value chain of these chips, transfer knowledge and train human talent.

Although it is independent of the agreement, The company also revealed an US$8 million investment and the hiring of 200 new engineers at its Intel Design Center in Guadalajara, a city in western Mexico that now employs more than 1,700 people.

“The center continues to grow and precisely as a sign of the confidence we have in Mexico, we continue to invest in modernizing our laboratories”stated Jesus Palominogeneral manager of the center, which has generated an economic benefit of US$ 1,000 million in its three decades of existence.

A solution for the crisis

The agreement is announced while the Mexican industry, in particular the automotive industry, is facing a shortage of these chips, a problem that caused a 2% annual decrease in vehicle production in 2021.

Production recovered 3.4% year-on-year in the first quarter of 2022, but exports fell 1.8% amid global inflation.

“We are not saying it, the industry itself has said it, which continues to struggle with the automotive industry itself, which continues to struggle with the issue of semiconductors”recognized the Secretary of Economy, Tatiana Clouthierat the signing of the agreement.

The importance of the automotive sector in Mexico lies in the fact that it represents 3.8% of the Gross Domestic Product (GDP) national and 20.5% of the manufacturing GDP, more than any other branch, according to the Mexican Association of the Automotive Industry (AMIA).

The secretary noted that “The need is going to increase because the technology is developing at a tremendous speed and more and more components are required”.

While the CEO of Intel warned that “This problem does not have a solution in the short term”. “Why? This is precisely the demand from all, absolutely all, industries”plot.

Talent attraction

The main objective of the agreement, which does not include a specific investment amount, is for Intel to donate artificial intelligence knowledge to companies in Mexico.where the industry in general already participates in five of the six stages of the manufacturing chain necessary to make semiconductors.

And as a sign of progress, there is already a company settling in Durangostate in the north of the country, where it will entirely manufacture the chipsSecretary Clouthier revealed.

“It becomes essential that we can have a conformation of this semiconductor through different aspects, where we increase the national content and where we can, above all, carry out the fundamental part”commented the official.

The secretary recalled that in the North American High-Level Economic Dialogue, Mexico and the United States agreed to include cooperation to strengthen the supply chain and personnel training in these inputs.

He also highlighted the inclusion of Singapore in the Pacific Alliance and the negotiation of the trade agreement with South Korea as opportunities for technology transfer and talent development in Mexico.

“It was thought in the past, before the pandemic existed, that in many things you did not need to do everything here because you were going to bring pieces from some places. The pandemic forces us to make fundamental changes in all of this.”concluded the official.