Bosch to buy TSI Semiconductors, invest $1.5 billion to increase US output

Bosch said Wednesday it plans to invest $1.5 billion to remodel TSI’s chip production facilities in Roseville, California, to begin producing silicon carbide chips by 2026.

The world’s largest auto parts supplier plans to acquire TSI’s buildings, machinery and infrastructure as well as its commercial semiconductor business.

The investment will be “heavily dependent” on federal funding opportunities, Bosch said.

Bosch also said that the TSI facility will become a “third pillar” of in-house semiconductor production alongside the two sites in Germany. Bosch’s automaker customers continue to push for more secure, diverse sources of chips.

“We step into a market that is developing very rapidly,” Chief Executive Officer Stefan Hartung said in an interview. bloomberg television,

“New platforms for electric vehicles – no matter where in the world they are produced – are mostly betting on silicon carbide technology,” said Hartung.

Bosch said demand for silicon carbide chips is growing rapidly by electric vehicle manufacturers.

Bosch said the silicon carbide chemistry enables greater driving range and faster recharging.

The demand for silicon carbide semiconductors is growing at a rate of 30 per cent annually.

Financial terms for the deal were not disclosed.

Bosch said the TSI site is currently a foundry for application-specific integrated circuits, or ASICs, used in various industries.

“This $1.5 billion investment will reduce costs, strengthen our electric vehicle supply chain, help rebuild American manufacturing and create economic opportunity,” US Vice President Kamala Harris said in a separate statement.

(with inputs from agencies)