In morning trade, the ASX lithium stock is up 17% to 20.5 cents.

Though, it is worth noting that its shares remain down approximately 75% on a 12-month basis despite today's strong gain.

Why is this ASX lithium stock surging today?

Investors have been buying Neometals shares today after the battery materials recycler released an update on its Primobius joint venture.

Primobius is a 50:50 joint venture between Neometals and German global plant manufacturer SMS group. It is focused on the development of sustainable processes for the recovery and recycling of lithium-ion batteries (LiB).

According to the release, Primobius has received a purchase order for the supply of a hydrometallurgical refining Hub from automotive giant Mercedes-Benz (ETR: MBG). The hydrometallurgical refining Hub will be installed at the automaker's Kuppenheim operation in Germany.

Neometals notes that the order value is estimated to be 18.8 million euros (A$30.8 million) and was awarded as part of a cooperation arrangement. Under the cooperation, Primobius is responsible for the engineering, equipment supply, and installation for a 2,500tpa fully-integrated, closed loop Mercedes LiB Recycling Pilot Plant.

The Hub is being designed to match the capacity required to process intermediate feed material generated from the front-end refining Spoke.

'Proud to partner with Mercedes'

Neometals' Managing Director, Chris Reed, was very pleased with the news. He said:

We are proud to partner with Mercedes in its journey to lead the closed-loop recycling of lithium batteries. The relationship exemplifies some of the unique aspects to Primobius' business model.

One of these is the ability to supply plant and offer technology licences so OEMs can retain their battery materials from scrap and end-of-life batteries. Supply certainty, low operating costs and low carbon footprint are key value drivers for OEM's looking forward. Our measured approach to delivering scalable solutions with our partner and leading plant builder SMS augurs well for penetrating this enormous addressable market.

The post Guess which ASX lithium stock is surging 17% on deal with Mercedes-Benz appeared first on The Motley Fool Australia.

The generative engine ChatGPT opened in November and has quickly caught the imagination of the public.

There is even talk that Microsoft Corp (NASDAQ: MSFT), which is a major investor in the startup behind ChatGPT, could challenge Alphabet Inc (NASDAQ: GOOGL)'s two-decade domination of internet searches by injecting AI into Bing.

Already "a veritable rainforest of new AI startups is being freshly funded", according to Frazis Capital Partners portfolio manager Michael Frazis.

"While it won't be clear for some time which will win and which will fall…, one thing is certain: they will all [need] immense amounts of computing power," he said in a memo to clients.

"Power that, absent this revolution, may not have been required for many years."

As such, some investors are looking to gain exposure to companies involved in manufacturing computer chips or, their key ingredient, semiconductors.

The best semiconductor stocks in the world

Shaw and Partners portfolio manager James Gerrish was recently asked which are the best ASX shares of businesses involved in the semiconductor industry.

"When I think semiconductors, my first thoughts are international companies such as Qualcomm Inc (NASDAQ: QCOM), NVIDIA Corporation (NASDAQ: NVDA), Texas Instruments Incorporated (NASDAQ: TXN), Broadcom Inc (NASDAQ: AVGO), Intel Corporation (NASDAQ: INTC), Taiwan Semiconductors Mfg Co Ltd (NYSE: TSM), Samsung Electronics Co Ltd (KRX: 005930), etc," he said in a Market Matters Q&A.

"Unfortunately there are no companies of this magnitude on the ASX."

So Gerrish suggested the next best option could be exchange-traded funds. But again, they are overseas shares.

"Two of our preferred ETFs to gain exposure to the semiconductor markets are the iShares Semiconductor ETF (NASDAQ: SOXX) and the VanEck Semiconductors ETF (NASDAQ: SMH)," he said.

"Locally, at this stage, there aren't any companies on the Market Matters radar."

Frazis took the example of Nvidia to demonstrate how critical computer chips are to power an AI-driven future.

"Nvidia is partnering with Mercedes Benz Group AG (ETR: MBG) to power their next generation of cars from 2024, including level 4 autonomy, over-the-air updates, and best-in-class safety and convenience applications," he said.

"Nvidia is a small position for us, bought at lower prices, but their 81% market share in AI processing is now more relevant than ever."

The post What are the best ASX shares to buy for semiconductor exposure? appeared first on The Motley Fool Australia.