In the face of continuing chip shortages, Bosch announced plans to invest an additional $296 million to expand its semi"> In the face of continuing chip shortages, Bosch announced plans to invest an additional $296 million to expand its semi">

Bosch increases investment in Reutlingen and Dresden plants

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In the face of continuing chip shortages, Bosch announced plans to invest an additional $296 million to expand its semiconductor manufacturing capacity. The investment follows previously promised investments by the German company aimed at current expansion efforts as demand increases for its MEMS and other devices.

The company first unveiled its investment plans in October 2021, announcing that it would spend over $472 million in 2022 to expand fabs in Dresden and Reutlingen, Germany, as well as Penang, Malaysia. Of that total, Bosch has earmarked $59 million for its Reutlingen plant, which currently produces 6-inch and 8-inch wafers. The Dresden factory currently produces 12-inch wafers.

Bosch said the new funds will be used to add an additional 38,750 square feet of cleanroom space to the Reutlingen plant, with investments in cleanroom capacity totaling $177 million by 2023. Cleanroom expansion will help refine Bosch’s silicon carbide production.

Bosch silicon carbide wafer factory in Reutlingen, Germany. (Source: Bosch) (Click on the image to enlarge)

“Cleanroom space in Reutlingen is expected to grow from approximately 376,737 square feet currently to over 473,612 square feet by the end of 2025,” the company said in a statement.

Expansion plans also include an existing power supply facility that supports current generation as well as new technologies. This includes ASICs, MEMS devices, and power semiconductors. With the expansion of its Reutlingen plant, Bosch said it would be able to meet the growing demand for MEMS devices for automotive and consumer applications. The company expects expanded production to begin in 2025.

“We are systematically increasing our semiconductor manufacturing capacity in Reutlingen,” said Stefan Hartung, Chairman of the Board of Directors of Bosch. “This new investment will not only strengthen our competitive position, but will also benefit our customers and help combat the crisis in the semiconductor supply chain.”

Still, supply constraints are not expected to ease any time soon and there is no industry consensus on when the shortages will end. For example, Samsung expects supply issues to persist through 2022, while Apple expects chip shortages to ease by the end of March.

For its part, Bosch said chip shortages would ripple through the global economy through 2022, reducing economic growth to between 4 and 4.5 percent, down from 5.5 percent last year. “Continued supply bottlenecks and rising prices for raw materials, primary products and transportation will have a major impact on the global economy and affect the operations of many sectors, especially the automotive industry” , the company said. “Sharp inflation in many sectors and regions is also clouding the outlook.”

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