Bosch makes historic investment in semiconductors

Bosch has today announced a €1billion (£873,000,000) investment in a new semiconductor fabrication plant in Dresden: the largest single investment in the company’s history. The plant is scheduled to start manufacturing in 2021, and will focus on 300mm wafer technology, which offers greater economies of scale, with up to 700 associates involved in the highly automated chip manufacturing process, working to plan, manage, and monitor production. The Dresden plant will be Bosch’s second wafer fab in Germany (existing one in Reutlingen) and will help the company expand its manufacturing capacity for global markets.

Semiconductor chips are a core feature of every car on the road, controlling the vehicle’s electrical systems – including its powertrain and vehicle handling, as well as telling the navigational system which way the vehicle is travelling and signaling the airbag to deploy when needed.

Bosch has been making semiconductors for more than 45 years, and is one of the world’s leading manufacturers of chips for mobility applications. In 2016, every vehicle newly registered worldwide had an average of more than nine Bosch chips on board.

Semiconductors for the auto industry: a market worth billions

In 2018, every new vehicle featured semiconductors worth £285 (source: ZVEI), and thanks to increasing electrification and automation, demand for chips in vehicles is expected to rise further over the next few years. By 2019, the semiconductor market will have grown at an annual growth rate of more than five per cent (source: PwC). Bosch’s semiconductor business is growing even faster than the market, as it is focused on making chips for vehicles. The Company currently holds over 1,500 patents and patent applications for engineering and manufacturing its semiconductors.

Chips for vehicles require tougher special components, as they are exposed to strong vibrations and extreme temperatures, ranging from far below zero to far above 100 degrees Celsius. Bosch’s heritage in engineering means it can apply its deep understanding of the physical principles at work in the chips, of how to gather the data and of the vehicles themselves to ultimately integrate it into the vehicle systems.

Electromobility and driver assistance systems boost demand

Bosch’s current semiconductor portfolio focuses on microelectromechanical systems (MEMS), ASICs for vehicle ECUs, and power semiconductors.

Power semiconductors are essential to hybrid and electrical vehicles, as they regulate the electric motor and make sure that the battery is being used as efficiently as possible.

Bosch microelectromechanical systems, or MEMS for short, are the sensory organs of modern vehicles. They supply a vehicle’s ECUs with important information regarding its handling, such as if the vehicle is braking or accelerating, or if it is skidding on a smooth road surface. The ESP electronic stability program uses this information to keep cars, trucks, and even motorcycles safely on track and in their lanes.

Continued strong growth in demand for driver assistance systems is ensuring that more semiconductors with more and more functions are finding their way into cars. Chips with built-in “intelligence”, known as ASICs, are tailored to a particular application; for example, signaling to airbags in a vehicle when they should deploy. These chips control handling to ensure a consistently safe journey. They also boost the measured signal from radar sensors, so that the proximity warning always functions reliably.

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