Bosch opens Dresden chip plant as Europe aims for independence from Asia

Published on June 7, 2021 by

The world’s largest automotive supplier Bosch has opened a new semiconductor plant in Dresden. Bosch has invested one billion euros in the site, which will focus on the production of microchips for the car industry.
The auto sector depends heavily on semiconductors from Asia, but disruptions in the global supply chain during the coronavirus pandemic have led to massive shortages. The plant is Europe’s first fully digitized and highly networked semiconductor factory. The German government also invested in the plant. Start of production is slated for July 2021.
When it comes to chips, it’s all about the tiny details. A single chip no larger than a fingernail contains several billion transistors. The science behind it is amazing.
Tens of thousands of silicon wafers, packed in boxes, are moving through the production sites of Globalfoundries, Europe’s largest chip producer, 24 hours a day, seven days a week. Once ordered, it can take up to three months to produce a chip. Some of the factory machinery costs as much as an aircraft.
Chips are scarce all over the world. It’s a good time to invest. Globalfoundries wants to double production at its German site. Nearby there is an Infineon plant. The company is the global leader for producing vehicle chips. There, too, there are plans to expand.
The world’s largest automotive supplier Bosch has also invested heavily, spending a billion euros on a new factory. The region around the city of Dresden has become the hub of Europe’s semiconductor industry. Every second European chip is made here.
Asia and the US are well ahead in this race. Europe now wants to combine its forces to catch up.
“Europe has to become more independent in chip making.” That’s what Christin Eisenschmid, Managing Director and Vice-President of Intel Germany, told DW’s Monika Jones in an exclusive interview addressing the current global chip shortage.
Eisenschmid is calling for the EU and regional governments to make semiconductor production a national priority and work with leading manufacturers to double production capacity by 2030. That includes paying subsidies, says the Intel rep. “We have to become more independent from Asia to be flexible enough to react to shortages” like the current one.
Eisenschmid says the current chip shortage is not only due to factory and supply chain problems in Asia, but is also caused by global demand growing faster than ever before. That, she says, is because of the ongoing digitalization, including in schools, the healthcare and auto sector.
Current problems are expected to be a burden for the industry for a while, as chip manufacturers cannot react fast to a changing environment. It takes up to four years to develop a new facility. Intel says, a concerted effort by private investors and governments can help speed things up.

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