(Eliminate dollar amount from BMW capacity agreement in paragraph 3).

Jane Lanhee Lee

(Reuters) -Canadian power chip maker GaN Systems on Tuesday said it raised $150 million in a funding round led by Fidelity Management & Research as it seeks to expand its market share, including a big push into the electric car market.

While a chip shortage has been plaguing the automotive industry, GaN Systems’ Chief Executive Jim Witham said his company has secured production volume with Taiwan Semiconductor Manufacturing Co to continue its growth. 

BMW Toyota Motor (NYSE:) Corp have been investors in GaN Systems for several years, and Witham said GaN recently signed its first “capacity agreement” with BMW to guarantee delivery of power chips. Each electric car uses approximately 100 power chips, he said.

Witham said that GaN Systems makes use of gallium-nitride (GaN), an alloy more recently used in chip production. It is capable to produce four times less power than traditional silicon-based power makers. Witham stated that gallium nitride chip sales only account for 1% of the $16 billion global powerchip market. However, they are expanding quickly.

“There’s a big play in automotive, EV, and now’s the time to really capitalize the company for that rapid growth and to gobble up market share,” said Witham.

Witham stated that GaN Systems chips are gaining traction for power chargers for consumer goods, in addition to their automotive customers. They are more efficient and smaller than silicon power chip. They can also be used to power servers, robotic motors, and renewable energy facilities.

Witham declined to disclose the company’s valuation.