Bosch poised to spend $3 billion to help resolve chip needs

But additional production anywhere in the world is certain to help alleviate the global scramble for chips.

The chip shortage started in the first months of the COVID-19 pandemic, when many industrial customers canceled longterm purchase orders from chip producers on the belief that auto plants would stay closed for months and house-bound consumers would have no interest in buying new cars.

But that same year, consumer demand for vehicles rocketed back to high levels, despite the pandemic, catching automakers and suppliers without enough chips to respond adequately.

In the resulting melee, the auto industry has been competing with giant consumer electronics companies to buy back chip allocations.

Bosch has been steadily investing to produce its own chips.

One year ago, Bosch opened new semiconductor wafer production capacity in Dresden at a cost of $1 billion, representing the largest single investment in the company’s history. And between now and 2025, Bosch said, it will invest another $400 million to expand chip capacity in Reutlingen, Germany.