To satisfy the demand generated by the growing number of internet of things (IoT) and mobility applications, Bosch is planning to build a wafer fab in Dresden, Germany.

The new location is to manufacture chips on the basis of 12-inch wafers. Construction of the plant is to be completed by the end of 2019, and manufacturing operations are slated to begin at the start of 2021, following a rollout phase. Bosch says that the total investment in the location will come to roughly one billion euros. The plant is expected to create as many as 700 new jobs in Dresden.

According to a study by PricewaterhouseCoopers, the global semiconductor market is set to grow by more than 5 percent annually up to 2019, with the mobility and IoT market segments growing especially strongly.

“The new wafer fab is the biggest single investment in Bosch’s more than 130-year history,” said Dr. Volkmar Denner, Chairman of the Board of Management of Robert Bosch GmbH. “Semiconductors are the core components of all electronic systems. With connectivity and automation growing, they are being used in more and more areas of application. By extending our semiconductor manufacturing capacity, we are giving ourselves a sound basis for the future and strengthening our competitiveness.”

Dresden’s microelectronics cluster, also known as “Silicon Saxony,” includes automotive suppliers and service providers as well as universities offering technological expertise. In addition, the Digital Hub Initiative launched by the Ministry for Economic Affairs and Energy (BMWi) aims to make Dresden an IoT ecosystem. Bosch intends to collaborate closely with local companies, and in this way to reinforce not only Germany’s, but also Europe’s position as an industrial location.