SiC power semiconductors: Bosch acquires US chip manufacturer TSI Semiconductors

Electric cars as a driver SiC power semiconductors: Bosch acquires US chip manufacturer TSI Semiconductors

2023-04-26 From Michael Eckstein 5 min Reading Time

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With approximately 1.4 billion euros, the technology conglomerate Bosch plans to convert TSI Semiconductor's ASIC manufacturing to silicon carbide chips and significantly expand its global range of SiC semiconductors by the end of 2030. The Roseville factory would be Bosch's second manufacturing site for the promising power semiconductors after Reutlingen.

Fully processed silicon carbide wafer: The demand for these highly efficient power semiconductors is increasing tremendously worldwide, partly due to the booming electromobility.(Image: Bosch) — Fully processed silicon carbide wafer: The demand for these highly efficient power semiconductors is increasing tremendously worldwide, partly due to the booming electromobility.
(Image: Bosch)

Bosch is expanding its semiconductor business with silicon carbide chips. In the USA, the technology company plans to acquire parts of the business of semiconductor manufacturer TSI Semiconductors from Roseville, California. The company, which employs 250 people, is a manufacturing operation, a so-called foundry, for application-specific integrated circuits (ASICs). It currently develops and produces in high volumes predominantly semiconductors on 200-millimeter silicon wafers for applications in the mobility, telecommunications, energy, and bioscience sectors. Bosch plans to invest more than 1.5 billion US dollars (approximately 1.39 billion euros) in the Roseville site in the coming years and convert the TSI Semiconductors manufacturing facilities. From 2026, the first semiconductors on 200-millimeter wafers based on the innovative material silicon carbide (SiC) are to be produced here.

With this move, Bosch strengthens its semiconductor business with highly sought-after SiC power semiconductors. The goal, according to their own statements, is to significantly expand their own offering for it worldwide by the end of 2030. Especially, the global boom in electromobility leads to a tremendous need for such special semiconductors for power electronics practically around the globe.

Subsidies from the "Chips and Science Act" subsidy program

The scope of the planned investments will depend on the funding opportunities provided by the US "Chips and Science Act" as well as the economic development opportunities in the state of California. Bosch and TSI Semiconductors have reached an agreement and have agreed to keep financial details of the transaction confidential. The acquisition is still subject to regulatory approvals.

The acquisition of the US manufacturer is of interest, especially since Wolfspeed, an American competitor, announced earlier this year its plans to build a similarly billion-dollar SiC factory in Ensdorf, Saarland – thereby securing better access to the important European market. Now Bosch is planning something similar for the US market, which also holds enormous potential for the application of SiC semiconductors in electromobility (and numerous other areas). In both cases, the companies can expect a plentiful influx of financial resources from generously equipped funding programs.

Competitor and power semiconductor market leader Infineon has long recognized the potential of silicon carbide technology, but is also investing in gallium nitride technology: Most recently, the company announced the acquisition of the Canadian gallium nitride specialist GaN Systems for 830 million US dollars.

Experienced professionals are part of the acquisition

"With the acquisition of TSI Semiconductors, we are establishing manufacturing capacities for SiC chips in a key sales market and at the same time globalizing our semiconductor production. The existing cleanroom spaces and specialized personnel in Roseville will enable us to manufacture SiC chips for electromobility on an even larger scale," says Dr. Stefan Hartung, Chairman of the Bosch management board.

According to Hartung, the site in Roseville has existed since 1984. Over the past almost 40 years, the US company has built up a great deal of know-how in semiconductor manufacturing. "We are now integrating this expertise into Bosch's semiconductor manufacturing network," says Dr. Markus Heyn, member of the board of management of Robert Bosch GmbH and chairman of the Mobility Solutions business sector.

10,000 square meters of cleanroom space: Production start planned for 2026 on 200-mm wafers

The new location in Roseville will strengthen Bosch's international manufacturing network for semiconductors. After a conversion phase, the first SiC power semiconductors on 200-millimeter wafers will be produced here from 2026, within cleanroom areas of approximately 10,000 square meters. Bosch invested early in the development and manufacturing of SiC semiconductors and has been producing such chips since 2021 at the German semiconductor site in Reutlingen near Stuttgart using its own highly complex processes, in the future also on 200-millimeter wafers.

The company is expanding the cleanroom area in Reutlingen until the end of 2025 from currently around 35,000 square meters to more than 44,000 square meters. "SiC chips are a key component for electrified mobility. By expanding our semiconductor activities overseas, we are positioning ourselves strongly in an important electromobility market also locally," says Heyn.

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On average, 25 Bosch chips in each car

The demand for semiconductors for the automotive industry remains high: Bosch expects that by 2025, an average of 25 Bosch chips will be integrated into each new vehicle. The market for SiC semiconductors is also continuing to grow strongly – at an annual average of over 30 percent. The main drivers of this growth are the global boom and ramp-up of electromobility.

In electric vehicles, SiC chips enable greater ranges and more efficient charging processes due to their up to 50 percent lower energy loss. In the power electronics of electric vehicles, they ensure that the car can drive significantly further on a single battery charge - on average, up to six percent more range is possible compared to chips based on silicon.

High investments in the key semiconductor technology

Semiconductors are a crucial success factor for all of Bosch's business areas. According to their own statements, the company recognized the potential of the technology early on and has been producing semiconductors for more than 60 years. This makes Bosch one of the few companies that, in addition to know-how in the fields of electronics and software, also has a deep understanding of microelectronics.

Bosch combines this competitive advantage with its strength in semiconductor manufacturing. The technology and services company has been producing in Reutlingen since 1970. The products are used both in the automotive sector and in consumer electronics. Modern electronics in vehicles are the basis for climate and accident protection in road traffic as well as efficiency in propulsion. Production in Bosch's 300-millimeter fab in Dresden started in July 2021. The construction of the semiconductor factory there, at one billion euros, is the largest single investment in the company's history to date.

By 2026: An additional three billion for European chip business

In total, since the introduction of the 200-millimeter technology in 2010, Bosch has already invested more than 2.5 billion euros in its semiconductor manufacturing facilities in Reutlingen and Dresden. This is in addition to billions more in investments for the development of microelectronics.

Independent of the now planned investment in the USA, the company announced in the summer of 2022 that, as part of its investment plan and with the help of the European funding program IPCEI Microelectronics and Communication Technology ("Important Project of Common European Interest on Microelectronics and Communication Technologies"), it would invest an additional three billion euros in its semiconductor business in Europe by 2026. (me)