July 14, 2026 /SemiMedia/ — Bosch has started sample production at its first semiconductor manufacturing facility in the United States and finalized a $225 million funding agreement with the U.S. Department of Commerce to expand domestic silicon carbide chip capacity.

The facility is located in Roseville, California. Bosch acquired the site from TSI Semiconductors in 2023 and began converting the existing factory into a manufacturing base for silicon carbide power semiconductors.

The project represents a total investment of about $2 billion, including U.S. government funding. Bosch plans to begin commercial production at the site later this year.

Paul Thomas, president and chief executive officer of Bosch in North America, said the United States-Mexico-Canada Agreement was one factor supporting the company’s decision to increase semiconductor investment in the United States.

As companies seek to build more complete regional supply chains, automakers increasingly want to work with suppliers that can provide stable and continuous chip deliveries from nearby manufacturing locations.

The $225 million award comes from the U.S. Commerce Department’s CHIPS Program Office, which was established under the 2022 CHIPS and Science Act to expand domestic semiconductor manufacturing and reduce reliance on overseas supply chains.

Unlike processors used for vehicle infotainment or advanced driver assistance systems, silicon carbide chips are mainly used in high-voltage power conversion.

In electric vehicles, silicon carbide power devices can improve the efficiency of electricity transferred from the battery to the motor. They can also reduce heat and energy losses while improving driving range and charging performance.

Silicon carbide devices can also be used in charging infrastructure, renewable energy systems, industrial equipment and data center power systems. As AI server power consumption rises, data centers are increasing demand for more efficient power conversion technologies.

Thomas said that while electric vehicle sales have grown more slowly than previously expected, demand from hybrid vehicles and defense applications also supports the economic case for the investment.

Industry analysts said hybrid vehicles still require efficient power management devices, while defense, aerospace and industrial customers place greater emphasis on domestic production, long-term availability and supply chain security.

These markets could reduce Bosch’s dependence on demand from fully electric vehicles.

Bosch also announced plans to invest up to $7.5 billion in the United States through 2031 to expand its manufacturing, research and broader business operations.

The start of sample production in Roseville marks the transition of Bosch’s U.S. silicon carbide project into process validation and customer qualification. As commercial production approaches, competition in the domestic U.S. silicon carbide supply chain is expected to increase.