On Tuesday, a German supplier of semiconductor chemicals and materials said that it is investing $1 billion in its US operations and established a joint venture with data analytics firm Palantir Technologies to address supply chain issues in the chip sector.
Merck KGaA of Darmstadt, Germany - which uses the name EMD Electronics for its North American electronics business to avoid confusion with the unrelated pharmaceutical company of the same name - supplies a variety of chemicals to chip factories, which are expected to expand if Congress passes a $52 billion aid package to boost domestic manufacturing.
The business intends to spend $1 billion on locations in Arizona, California, Texas, and Pennsylvania between now and 2025.
"To overcome the supply chain challenges that consumers are currently encountering, industry-wide cooperation is required," Kai Beckmann, chief executive of the German firm's electronics unit, said in a statement.
Merck KGaA also announced on Tuesday that it is launching a joint venture with Palantir, a data analytics firm. The goal of the joint venture is to gather data from material and chemical suppliers on the one hand, and chip makers on the other, and analyze it in order to increase efficiency.
According to Laura Matz, who will supervise the new joint company, which will be called Athina, both the suppliers and the chip makers have vast trade secrets and have generally been hesitant to share data beyond their respective organizations. Athina will be headquartered within EMD Digital, a Merck KGaA subsidiary independent from the company's electronics division.
The reluctance to share data has been a barrier to tackling this problem (of supply-chain inefficiency) for years, according to Matz. "We couldn't get over it until we came up with the concept of how we're arranging the data in such a manner that there's no (intellectual property) contamination."
The financial specifics of Merck KGaA's joint venture with Palantir were not disclosed.