Bosch is investing billions more in chip business

From cars and e-bikes to household appliances and wearables, semiconductors are an integral part of all electronic systems. They are the engine that drives the modern technological world. Recognizing its growing importance early on, Bosch has now announced that it will invest billions of euros more to strengthen its own semiconductor business. Bosch plans to invest an additional € 3 billion in its semiconductor division by 2026 as part of the IPCEI funding program for microelectronics and communications technology.

“Microelectronics is the future and crucial to the success of all Bosch components. This holds the key to tomorrow’s mobility, the Internet of Things and to what we at Bosch call technology ‘invented for life’,” said Stefan Hartung, President of Bosch’s Board of Directors, at Bosch Tech Day 2022 in Dresden.

One of the projects that Bosch intends to finance with this investment is the construction of two new development centers – in Reutlingen and Dresden – at a total cost of more than 170 million euros. In addition, the company will spend 250 million euros in the coming year on creating 3,000 square meters of extra clean room space at its wafer factory in Dresden. “We are preparing for continued growth in semiconductor demand – also for the benefit of our customers,” Hartung said. “For us, these miniature components mean big business.”

Promote microelectronics to increase Europe’s competitiveness

Under the European Chips Act, the EU and the German federal government provide additional funding to develop a robust ecosystem for the European microelectronics industry. The goal is to double Europe’s share of global semiconductor production from 10 to 20 percent by the end of the decade. The recently launched IPCEI on microelectronics and communication technology is primarily aimed at promoting research and innovation. “Europe can and should harness its own strengths in the semiconductor industry,” Hartung said. “The goal must more than ever be to produce chips for the specific needs of European industry. And that doesn’t just mean chips at the bottom of the nanoscale. ” Electronic components used in the electromobility industry, for example, require process sizes between 40 and 200 nanometers.

Significant expansion of 300 millimeter chip production in Dresden

This new investment in microelectronics also opens up new areas of innovation for Bosch. “Being a leader in innovation starts with the smallest electronic components: semiconductor chips,” says Hartung. New areas of innovation at Bosch include system-on-a-chip, such as radar sensors, a vehicle uses to perform 360-degree scans of the environment during automated driving. Bosch will now try to improve such components so that they become smaller, smarter and also cheaper to produce. The company is also working on further adapting its own micro-electromechanical systems (MEMS) specifically to the consumer goods industry. One of the things that business researchers are currently using to develop this technology is a new projection module so small that it can be built into the spectacle lens. “To strengthen our market-leading position in MEMS technology, we also plan to manufacture our 300 millimeter wafers MEMS sensors,” said Hartung. “Production is scheduled to start in 2026. Our new waffle factory will allow us to scale up production – an advantage we want to take full advantage of.”

High demand for silicon carbide chips from Reutlingen

Another focus area at Bosch is the production of new types of semiconductors. For example, Bosch has been mass-producing silicon carbide (SiC) chips at the Reutlingen plant since the end of 2021. These are used in the power electronics needed for electric and hybrid cars, where they have already contributed to an increased range of up to 6 percent. Thanks to strong market growth, with annual rates of 30 percent or more, the demand for SiC chips remains high, which means that Bosch’s order books are overflowing. To make this power electronics more affordable and efficient, Bosch is also exploring the use of other types of chips. “We are also exploring the development of gallium nitride chips for electromobility applications,” Hartung said. “These chips are already in chargers for laptops and smartphones. Before they can be used in vehicles, they must become more robust and withstand significantly higher voltages up to 1,200 volts.” Challenges like these are all part of the job of Bosch engineers. Our strength is that we have been familiar with microelectronics for a long time – and we know each other just as well in cars. ”

Bosch is systematically expanding its capacity for semiconductor manufacturing

Bosch has made several investments in its semiconductor business in recent years. The best example of this is the waffle factory in Dresden, which opened in June 2021. With € 1 billion, it is the largest investment in the company’s history. The Reutlingen semiconductor center will also be systematically expanded: between now and 2025, Bosch will invest approximately 400 million euros in expanding production capacity and converting existing factory premises into new clean room space. This includes the construction of a new extension in Reutlingen that will create an additional 3,600 square feet of state-of-the-art clean space. Overall, the cleanroom area in Reutlingen will grow from approximately 35,000 square meters today to more than 44,000 square meters by the end of 2025.

Expertise and an international network ensure sustainable success

Bosch is the automotive industry’s leader in semiconductor development and production. These chips are used not only in the automotive industry but also in the consumer goods industry. Bosch has been active in this field for over 60 years. For example, the Bosch semiconductor factory in Reutlingen has been producing chips based on 150 and 200 millimeter wafers for 50 years. Production of 300 millimeter wafer-based chips began production at the company’s Dresden plant in 2021. Semiconductors manufactured in Reutlingen and Dresden include application-specific integrated circuits (ASICs), microelectromechanical systems (MEMS) sensors, and power semiconductors. Bosch is also building a new semiconductor test center in Penang, Malaysia. From 2023,

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