German engineering and technology company, Robert Bosch GmbH, has recently acquired parts of the California-based semiconductor manufacturer, TSI Semiconductors, in response to the increasing demand for chips for electric cars. While the financial details of the takeover have not been disclosed, Bosch has announced its investment of at least $1.5 billion into the conversion of the foundry to silicon carbide (SiC) processors. Bosch’s investment plans will depend on funding opportunities from the US Chips and Science Act and economic development opportunities in California.
SiC chips have been deemed particularly suitable for electric cars, with Bosch stating that it has up to 50% less energy loss compared to silicon-based chips. The use of SiC chips enables electric cars to travel longer distances with more efficient charging processes. The company’s announcement of the investment comes at a crucial time when many global automakers are shifting their focus towards the production of electric vehicles.
Bosch’s move marks its first chip factory outside of Germany, with previous production taking place in Reutlingen since 1970 and in Dresden since 2021, with the use of 300-millimeter wafers. The California location will allow for greater ease of US sales, as the country ties subsidies for electric vehicles to the generation of battery value in the USA, Canada, or Mexico, with plans to increase this threshold to 100% by 2029.
Despite the investment and expansion into the United States, Bosch is also continuing to invest in national chip production with the help of the European funding program IPCEI for microelectronics and communication technology. The company will also expand its Reutlingen production facility’s clean room, which measures 35,000 square meters, to more than 44,000 square meters.
In conclusion, Bosch’s acquisition of parts of TSI Semiconductors and investment into SiC chip production highlights its response to the growing demand for electric vehicles, as global automakers shift away from traditional methods. The company’s strategic move into the United States could also assist in maximising sales, given the country’s subsidy requirements.