A performance chip is a small electronic device that can be installed in a vehicle's engine control unit (ECU) to enhance its performance. By modifying the engine's settings, such as fuel-to-air ratio and ignition timing, these chips can increase horsepower and torque, leading to improved acceleration and overall driving experience. Many car enthusiasts use performance chips to optimize their vehicles for specific purposes, such as racing or off-roading. However, it's important to note that using a performance chip may void the vehicle's warranty and could affect emissions compliance, depending on local regulations.