What Happened
Bosch has announced plans to transition its semiconductor business into a dedicated division named Semiconductors, effective January 2028, according to The Next Web. The new unit will remain a part of Bosch rather than forming a completely separate company. The restructuring aims to grow annual semiconductor revenue to approximately €5bn by 2030.
The Details and Expansion Plans
The chip business is currently housed within Bosch’s Mobility Electronics division, which will continue managing the production of automotive electronic control units. With the upcoming restructuring, Bosch intends to open its manufacturing facilities to external clients and broaden its foundry business to produce semiconductors for other firms. Target markets for these external chips include robotics, factory automation, AI data centers, and consumer devices such as smartphones and wearables. Erik Rein, who leads Bosch’s chip business, stated that this new unit marks a new chapter in the company's chip history spanning more than 60 years.
Manufacturing Footprint and Investments
Bosch operates around 40 chip sites worldwide and has invested about €3bn in its wafer plants located in Dresden and Reutlingen. The company is also spending roughly $2bn to convert its facility in Roseville, California, to silicon carbide production, and plans to expand its test center in Penang, Malaysia, through the mid-2030s. Additionally, Bosch maintains a 10% stake in ESMC, which is the TSMC-led semiconductor joint venture constructing a factory in Dresden. The company already produces silicon carbide chips, custom circuits for power systems, and MEMS sensors used in smartphones and robots.
Background and Industry Context
The strategic shift occurs as Europe's automotive sector navigates ongoing chip supply vulnerabilities, highlighted during autumn supply shortages involving Nexperia that underscored the industry's reliance on a narrow pool of suppliers. According to Bosch deputy chairman Markus Heyn, the company's sensors serve as the key to its products and the technological foundation for customer innovations. By offering its manufacturing capacity to external clients, Bosch seeks to diversify Europe's semiconductor supply while uncovering new market opportunities for its technology.