The global semiconductor crisis doesn’t seem to be going away anytime soon. According to a Reuters report, Bosch expects the chip crunch and increasing raw material costs to continue hampering vehicle production throughout 2022.
As it stands, vehicle production in Europe has yet to recover to pre-pandemic levels. In 2019, over 92 million vehicles rolled off European production lines, versus the 80-odd million in 2021. Despite the much lower output, many major automakers are posting record profits, and Bosch predicts that 85 million vehicles would be produced in Europe this year.
To maintain steady chip supply, Bosch plans to invest around US$457 million (RM1.9 billion) to expand its semiconductor manufacturing facilities in Penang (Malaysia), Dresden and Stuttgart (Germany). It’s understood that the company is not planning to make any further investments beyond this.
Bosch CEO Stefan Hartung told reporters: “Last year we felt very clearly that we did not have enough chips to meet demand. That will become better in 2022, significantly so in the second half. Hopefully in 2023 we can work at the pace we want to.”
Bosch is ranked at the very top of Automotive News Europe’s list of top 100 global suppliers, with worldwide parts sales totaling US$46.52 billion (RM194.62 billion) in 2020. Its 2021 revenue of US$90 billion (RM376.51 billion) exceeded pre-pandemic levels, with an EBIT margin of 4% (up from 2.8% in 2020).
The company expects revenue to grow again this year, provided there are “no major additional disturbances.” Its mobility solutions division, which comprises the automotive components segment bringing in most of Bosch’s revenue, saw weaker growth in part due to the lack of chips.
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There’s gold in them chips…
According to some Bosch can now compete with Lays and Fritos. German chips rulez!