An associate is reflected in a 300-millimeter wafer in the clean room during a press tour of the new semiconductor factory of the Bosch company in Dresden, Germany, May 31, 2021. The chip factory will officially start working on June 7, 2021. (Robert Michael/dpa via AP)

 

BERLIN (AP) — German technology company Bosch on Monday opened a 1 billion euro ($1.2 billion) chip factory in the eastern city of Dresden to help meet the growing demand for semiconductors.

A global shortage of semiconductors has forced major auto companies such as Volkswagen and BMW to slow vehicle production in recent months.

“Bottlenecks on the semiconductor market have made the economic recovery after the coronavirus crisis more difficult,” German Chancellor Angela Merkel said at the opening ceremony.

Speaking by video link from Berlin, she suggested that computer chips have replaced oil as the “life blood” of economies.

Bosch, a major supplier to the car industry, said the factory is the biggest single investment in its 130-year history. It will employ 700 people to produce silicon wafers containing tens of thousands of custom-made chips that will control its airbags, braking and parking control systems.

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