Bosch’s new semiconductor factory starts key testing phase and is expected to start production by the end of the year to produce automotive chips

On March 10, it is reported that Bosch has started a key test phase at its new semiconductor factory in Dresden, Germany. The 1 billion-euro factory is expected to start production by the end of this year and will mainly produce automotive chips.

It is understood that the silicon wafer prototype of Bosch’s plant in Dresden has passed the fully automated production process for the first time. Wafers take about six weeks to process, and about 700 more processing steps.

The Dresden facility focuses on the manufacture of 300mm wafers, one of which can hold 31,000 individual chips. Bosch says this larger size offers greater economies of scale than traditional 150mm-200mm wafers.

In automotive integrated circuits, these semiconductor chips act as the “brains” of the car, processing the information collected by the sensors and triggering further actions.

The Dresden plant, which broke ground in June 2018, will employ around 700 people.

The European Union has made European semiconductor production an important project of common European interest, the IPCEI. The designation opens the door to financing public and private projects, while also relaxing some competition rules to allow for faster development of the industry. Bosch is listed as a partner of the Semiconductor IPCEI.

Analysts and auto industry executives said they expect core shortages to continue into the first half of the year, with more than 1 million vehicles expected to stop production.

Recent forecasts by the China Association of Automobile Manufacturers show that the chip shortage will have a significant impact on auto production in the first quarter of 2021, and is expected to spread to the second quarter.

In addition, the Passenger Federation said that since the end of last year, the supply of automotive chips has been on the cusp, but the overall pressure is not great. The current underproduction of passenger cars does not amount to a direct market loss. According to monitoring, the current terminal retail prices of the auto market are relatively stable, and there is no obvious trend of price increases for main models, which reflects the strong ability of manufacturers and dealers to respond to crisis. Mainstream automotive chips are highly profitable and have high requirements for adaptability, reliability, durability, and compliance. Therefore, hidden costs and barriers to entry are high. OEMs are very cautious in choosing suppliers. As the Equipment Department of the Ministry of Industry and Information Technology and domestic electronics companies comprehensively promote countermeasures to alleviate the chip problem, as a car chip with extremely mature technology, under this rare opportunity, the supply of new production capacity will be gradually released. In addition, the domestic blocked chip production capacity will gradually recover. Sales should not be affected too much by chip shortages.

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