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Bosch as a driver of innovation: investing more in new chips that make technology “Invented for life” possible

Athanassios Kaliudis

Athanassios Kaliudis >

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Dr. Stefan Hartung,
chairman of the board of management, Robert Bosch GmbH,
at the Bosch Tech Day in Dresden, July 13, 2022

Check against delivery.

Welcome to Europe’s most advanced wafer fab,
ladies and gentlemen.

Today, you will see first-hand what new chips are capable of and how they are made. To see our chips in action, however, you only need to stand next to the cycle route along the River Elbe, which passes quite close to here on its way from Dresden to Hamburg. There are now more e-bikes than conventional bicycles on that route, and to put it mildly, it’s not at all uncommon to catch a glimpse of five red letters on those e-bikes’ electric drives. What I mean, of course, are the five letters that spell Bosch. Indeed, our innovations – which feature the chips we make ourselves – created the market for e-bike equipment. Across all our divisions, our recipe for success is “Invented for life.” ABS, for bicycles as much as for motorcycles and cars, a learning fitness tracker that uses artificial intelligence to continuously detect new exercises, a robot that hovers above the factory floor, a molecular-diagnostic platform that makes it possible to carry out roughly ten different rapid PCR tests for Covid-19 and other infectious diseases – all this is technology that makes life easier and safer. It is no exaggeration to say that Bosch has always been a driver of innovation on many fronts. But the innovations I just mentioned have something essential in common – their chips. And all of them serve the same purpose – to make life easier, or even to protect it.

Innovativeness doesn’t just need a powerful vision, but also financial strength. In 2021, our research and development cost came to 6.1 billion euros. That was just under 8 percent of sales – a share that is well above the average for our industries. In 2022, we will increase this cost once more, to nearly 7 billion euros. What is also crucial for successful innovation is a strong team that lives and breathes the shared vision of technology we have at Bosch. At the end of 2021, we employed nearly 78,000 associates in research and development. Of them, one in two is involved in software development. Industrial enterprise? IT company? Bosch has long since been both. We connect our products over the internet of things, we enhance them with artificial intelligence, and here as well we are guided by the conviction that more technology means better quality of life.

More than ever, we see innovation leadership as something that starts out small – and I mean that literally. It starts with the smallest elements of electronics: chips. In that sense, we’ve come to the right place today. Bosch remains the leading company in the automotive industry that produces semiconductors itself. We have been producing them on 150- and 200-millimeter silicon wafers in Reutlingen for decades now, and on 300-millimeter wafers here in Dresden for a year. It’s hard to believe, but this new factory is the first 300-millimeter wafer fab to be built in Europe since 1999.

It’s good that other major microelectronics companies will now also be building new factories in Germany. This is exactly what the European Chips Act aims to achieve. Its goal is an ambitious one – the technological sovereignty of our continent, no less. More specifically, it wants Europe’s share of global semiconductor production to double from 10 to 20 percent by the end of the decade. But we shouldn’t expect this to make Europe independent of supplies from other regions of the world. Nor is this what the act aims to achieve. But our continent can and must bring its strengths to the table. The important thing here, more than ever, is that chips need to be produced to meet the demand of European industry. In other words, not just tiny, nanometer-scale chips. For the electronics used in electromobility, for example, the process sizes are between 40 and 200 nanometers. This is a field in which we know exactly what we’re talking about. Bosch specializes in combining systems and chip expertise. And it’s precisely this combination that the Dresden plant is designed for.

Bosch has already invested one billion euros in the construction of this new wafer fab. It was the biggest single investment in our company’s history. This was made possible not least by the joint support of the EU Commission, the German federal government, and the Saxony state government – specifically by a special subsidy program that had its premiere in the microelectronics industry. The program is known as IPCEI, which stands for “important project of common European interest.” Bosch now employs 350 people in the plant. By the end of 2022, there will be more than 400, and we expect there to be 700 working here when the plant is completed. This is more than was required as a condition of the subsidy. Some two-thirds of the workforce are engineers and computer scientists – graduates of Dresden University and other talented people from outside Germany. The new wafer fab thus reflects Bosch’s cultural diversity – people from more than 20 countries currently work under its roof.

In a very short time, production operations here in Dresden have reached a high level of maturity. They are being ramped up faster than planned, after having started a whole six months earlier than scheduled. Given the supply bottlenecks in our industries, we don’t want to lose any time. We are debuting an AI-based quality approval process in our new wafer fab. This will allow us to speed up customer release processes. Roughly 150,000 sensors have been installed in the new plant. Every second, they generate a data volume of 250 megabytes – equivalent to streaming 400 HD-quality Netflix films simultaneously. Only artificial intelligence is capable of filtering out the essential information from this mass. I said right at the start of my presentation that our plant in Dresden is Europe’s most advanced wafer fab. I would add something else: it is also a factory that already demonstrates the future of industrial production – completely connected, full of AI.

However, the development of semiconductors continues apace. To keep up with it, Europe is initiating a new funding program. This is something we warmly welcome. IPCEI 2 for microelectronics is on its way. This political decision is important, but it isn’t everything. The project also needs to be accepted by society. Only if there is openness toward new technologies and more STEM education in schools will these future investments bear fruit. Here in Dresden, we can see what priorities need to be set. Like few other cities, Dresden stands for Europe’s cultural heritage. At the same time, however, it is the center of “Silicon Saxony,” above all because of the specialists based here. If we don’t want to live off our history, we have to live for modern technology.

Bosch, for its part, still has plenty of plans up its sleeve. Within the framework of IPCEI 2 alone, we want to invest some 3 billion euros in our semiconductor technology and the systems based on it by 2026. Between now and the middle of the decade, for example, we will expand our wafer fab in Reutlingen. And as early as 2023, we want to extend our Dresden location. Among other things, we will add 3,000 square meters of clean-room space, one-third more than at present. More chip capacity is one of our objectives.

But above all, IPCEI 2 will promote research and development in microelectronics. With its investments, Bosch is opening up three areas of innovation in particular:

  • First, we want more technology invented for a safe life. Nine out of ten traffic accidents are due to human error – and these are the accidents that can be prevented by automated driving. Microelectronics will also play a part here. For example, Bosch is developing systems-on-a-chip that make things such as radar sensors for 360-degree scans of a car’s surroundings smaller, smarter, and more cost-effective to produce.
  • Second, we want technology invented for a connected life. One example is the tiniest ever projection module for smart glasses. Bosch is producing this module on the basis of MEMS technology, and making it so small that it will fit into the temple of the glasses. This will allow the wearer to receive all kinds of information, yet without looking like an alien. For this and other microelectronics solutions, we are building a new development center at our Reutlingen location. We will also be tapping into further technical potential here in Dresden, where a development center for both semiconductors and MEMS sensors is being built. In the future, we want to produce these sensors on 300-millimeter wafers as well, in order to further extend our leading market position in micromechanics. Start of production is scheduled for 2026. But even now, a team of MEMS sensor experts is taking root in Dresden. The new wafer fab offers new opportunities that we want to exploit.
  • Third, we want technology invented for a sustainable life. To achieve this, our development people in Reutlingen are aiming for a new level of power electronics for electromobility. By using silicon carbide chips, Bosch has already been able to increase the range of electric cars by as much as 6 percent. The demand for these chips is high, and the market will grow by an annual 30 percent on average over the course of the decade. For us, this is an incentive to hunt for other technologies that will make power electronics even more efficient and affordable. Specifically, we are looking into the development of chips based on gallium nitride. Such chips are already used in laptop and smartphone chargers. In vehicles, however, they will have to withstand significantly higher voltages of up to 1,200 volts. So the issue here is robustness – a challenge that is all part of the job for Bosch engineers, who are just as much at home in the microelectronic and automotive worlds.

This is an excellent example of how semiconductor technology is not an end in itself for Bosch, but always part of a greater whole. For us, electromobility stretches from the chip to the e-axle, and this is also why we are the leading automotive supplier in this promising area. All in all, chips’ share of a car’s total value will quadruple over the course of the decade – from just under 200 euros to more than 800 euros. Bosch wants to share in this growth. In consumer electronics as well, we are among the frontrunners. There are Bosch MEMS sensors in more than half the smartphones on the planet. And the first semiconductors to be produced here in Dresden were installed in Bosch cordless screwdrivers. These practical applications of our microelectronics are what make Bosch attractive for young engineers. And even if these tiny electronic components are hidden from view, at Bosch they aren’t just used anywhere, but in tangible technology that people can experience for themselves. Including cyclists on the Elbe cycle route.

About Bosch

The Bosch Group is a leading global supplier of technology and services. It employs roughly 402,600 associates worldwide (as of December 31, 2021). The company generated sales of 78.7 billion euros in 2021. Its operations are divided into four business sectors: Mobility Solutions, Industrial Technology, Consumer Goods, and Energy and Building Technology. As a leading IoT provider, Bosch offers innovative solutions for smart homes, Industry 4.0, and connected mobility. Bosch is pursuing a vision of mobility that is sustainable, safe, and exciting. It uses its expertise in sensor technology, software, and services, as well as its own IoT cloud, to offer its customers connected, cross-domain solutions from a single source. The Bosch Group’s strategic objective is to facilitate connected living with products and solutions that either contain artificial intelligence (AI) or have been developed or manufactured with its help. Bosch improves quality of life worldwide with products and services that are innovative and spark enthusiasm. In short, Bosch creates technology that is “Invented for life.” The Bosch Group comprises Robert Bosch GmbH and its roughly 440 subsidiary and regional companies in some 60 countries. Including sales and service partners, Bosch’s global manufacturing, engineering, and sales network covers nearly every country in the world. With its more than 400 locations worldwide, the Bosch Group has been carbon neutral since the first quarter of 2020. The basis for the company’s future growth is its innovative strength. At 128 locations across the globe, Bosch employs some 76,100 associates in research and development, of which more than 38,000 are software engineers.

The company was set up in Stuttgart in 1886 by Robert Bosch (1861–1942) as “Workshop for Precision Mechanics and Electrical Engineering.” The special ownership structure of Robert Bosch GmbH guarantees the entrepreneurial freedom of the Bosch Group, making it possible for the company to plan over the long term and to undertake significant upfront investments in the safeguarding of its future. Ninety-four percent of the share capital of Robert Bosch GmbH is held by Robert Bosch Stiftung GmbH, a charitable foundation. The remaining shares are held by Robert Bosch GmbH and by a corporation owned by the Bosch family. The majority of voting rights are held by Robert Bosch Industrietreuhand KG, an industrial trust. The entrepreneurial ownership functions are carried out by the trust.

Additional information is available online at www.bosch.com, www.iot.bosch.com, www.bosch-press.com, www.twitter.com/BoschPress.

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