Bosch opened a 1 billion euro ($1.2 billion) chip plant in Germany on June 7th, a record investment by the leading automotive supplier as it stakes a claim to equipping the latest electric and self-driving cars.
The plant, located in a semiconductor hub near Dresden, opens as the automotive industry battles a global chip shortage, and will increase Bosch’s ability to serve carmakers directly, relying less on third-party manufacturers.
The Bosch plant will make specialist power-management chips and Application Specific Integrated Circuits (ASICs) that are designed to carry out a single task, such as triggering a car’s automatic braking system.
It will not however address shortages of products like microcontrollers which have forced auto makers to halt production and are expected by industry leaders and analysts to extend into next year.
“The fab (chip fabrication plant) may help to insulate Bosch and its key customers somewhat,” said Asif Anwar at Strategy Analytics. “But it is unlikely to serve as a gap filler to the current shortages being experienced in the automotive market.”
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