U.S. Commerce Department and Bosch Deal

By David Shepardson

The U.S. Commerce Department announced a preliminary deal with German auto supplier Bosch for subsidies of up to $225 million to manufacture silicon carbide power semiconductors in California, essential for electric vehicles.

Investment Details

The funding will aid Bosch’s planned $1.9 billion investment to upgrade its manufacturing facility in Roseville, California for SiC power semiconductor production. Additionally, Commerce is proposing around $350 million in government loans for this endeavor.

This initiative leverages the $52.7 billion fund established for U.S. semiconductor production and research, approved in 2022. Officials are racing to finalize loan terms before President-elect Donald Trump's inauguration.

Production Timeline

Bosch anticipates producing its first chips on 200-millimeter wafers in Roseville starting in 2026. SiC chips are vital for the automotive, telecommunications, and defense industries, being energy-efficient and boosting electric vehicle performance.

In 2023, Bosch acquired assets from TSI Semiconductors, indicating that the chip production will rely heavily on federal funding.

Impact on Manufacturing

Bosch, like others in the automotive sector, faced challenges due to semiconductor production disruptions in Asia worsened by the COVID-19 pandemic.

In October, a preliminary agreement was made with Wolfspeed for $750 million in grants for its new silicon carbide wafer plant in North Carolina.

Commerce stated that once the Bosch facility operates at full capacity, it could account for over 40% of U.S.-based SiC device manufacturing.

Statements on the Investment

Paul Thomas, president of Bosch in North America, emphasized that the Roseville investment allows for local silicon carbide semiconductor production, aiding U.S. consumers in electrification efforts.

Representative Doris Matsui, a California Democrat and contributor to the 2022 law, noted that this funding enables Bosch to create essential components for advancements in clean mobility and electric vehicles.