South Korea to Accelerate Automotive Chip R&D

The South Korean government will invest 95.7 billion won in automotive chip R&D from 2020 to 2025.

The South Korean government announced on Nov. 18 that it would invest 95.7 billion won from 2020 to 2025 for automotive chip R&D and import replacement purposes.

At present, a chip shortage is still ongoing in the global automotive industry. According to market research firms, this year’s production setback attributable to the shortage is estimated at up to 10.15 million vehicles. In South Korea, the setback increased to 120,000 vehicles until the end of last month and the shortage is likely to continue until the first half of 2022.

According to the government’s plan, more incentives will be provided for foreign-invested automotive chip companies running facilities in South Korea. The examples include ON Semiconductor, which is expanding its facilities in Bucheon by investing 250 billion won for SiC chip production.

The government is going to promote collaboration between suppliers and clients so that essential chips can be domestically developed and domestic supply chains can be stabilized. It will come up with a national automotive chip development roadmap in January next year and assist in performance assessment for reliability enhancement, too.