Bosch Invests Even More To End Chip Shortage Crisis

Industry News / 1 Comment

Its new production facility will bolster production of the scarce commodity.

The ramifications of the chip crisis are well-documented. To circumvent the problem, carmakers have had to resort to drastic measures. Myriad companies have had to pause production, with Ford, for example, halting the manufacturing of the Bronco and several other models at its various plants. With strong demand for its products, you can imagine this was the last thing the Blue Oval wanted.

Engineering giant Bosch has been looking into ways to assuage the dilemma. Last year, the German company announced it would be spending more than €400 million (approx $450 million) in 2022, with plans to expand its semiconductor operations in Germany, and Malaysia. Now, the tech giant has said it will invest an additional €250 million (approx $280 million) into a new production space needed for chip production. The facility will give Bosch the ability to meet the ever-growing chip demand used in IoT and mobility applications.

Bosch
Bosch
Bosch
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," said Dr. Stefan Hartung, chairman of the board of management.

Scheduled for completion in the next three years, the Reutlingen-based extension will allow Bosch to bolster its semiconductor production. With an additional 3,600 square meters of clean-room space, the all-new production facility will go into operation in 2025. While that's still some time away, the company is clearly preparing for the future, especially as electric vehicles become more commonplace.

Hopefully, the chip crisis doesn't extend as far as 2025, but carmakers have previously warned the situation may stretch into 2023. Production stoppages aside, carmakers have also taken to removing features from cars as a way of navigating the shortage. While not a permanent solution, it allows production lines to continue moving. GM recently did this with the C8 Corvette, temporarily deleting the rear park assist system from the sportscar's options list.

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With over 60 years of experience in developing and producing semiconductors for the automotive industry, Bosch is a leading light in the industry. The expansion is also part of the company staying ahead of the pack, but another strategy is constant innovation. Since December 2021, the company has been manufacturing chips made of silicon carbide. Bosch is currently the only automotive supplier in the world manufacturing chips from this innovative material which, it says, will play an increasingly important role in electromobility.

"AI methods combined with connectivity have helped us achieve continuous, data-driven improvement in manufacturing and thereby produce better and better chips," says Bosch's Markus Heyn.

Among the numerous improvements, the company has developed software that is able to detect and classify defects. Hopefully, the chip crisis is a distant memory by the time the new plant is ready, but it's encouraging to see industry players learning from the current shortage and implementing plans to prepare for the future.

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