December 16, 2024 /SemiMedia/ — The U.S. Department of Commerce announced that it has reached a preliminary agreement with German automotive component supplier Bosch to provide up to $225 million in subsidies for the construction of a silicon carbide (SiC) power semiconductor plant in Roseville, California. The planned $1.9 billion investment will also be supported by a proposed government loan of around $350 million.

Bosch expects the semiconductor plant to begin production in 2026, focusing on manufacturing SiC power semiconductors using 200mm (8-inch) wafers. SiC chips consume less energy and are critical for improving the performance and charging efficiency of electric vehicles, as well as benefiting the telecommunications and defense industries.

The Department of Commerce noted that, when fully operational, the plant’s capacity will account for over 40% of the U.S. silicon carbide chip production. Bosch North America President Paul Thomas said that the Roseville investment will support domestic production of SiC chips and aid in the electrification of the U.S.

California Democratic Congresswoman Doris Matsui, who helped draft the CHIPS Act, stated that the subsidy will enable Bosch to produce key components that drive clean transportation, electric vehicles, and other clean energy technologies.