German Technology Group Bosch announced on Monday that its car chip factory in Dresden will begin production of chips already in June, and full-scale production of electronics will be launched by the end of the year.
The plant with an investment of 1 billion euros will produce sensor chips that will be installed in electric and hybrid electric vehicles.
Construction of the facility began in June 2018 on a land plot of approximately 100,000 square meters, or approximately 14 football fields. The plant is located in Silicon Saxony, Dresden's answer to Silicon Valley.
Bosch has begun testing fully automated chip prototyping, a step towards full-scale production at the end of the year, it said.
In March, the plant will start producing the first batches of complex integrated circuits. To turn prototypes into finished semiconductor chips, they go through about 700 processing steps, which take more than ten weeks to complete.
The factory, partly funded by the Free Land of Saxony and the federal government in Berlin, will employ 700 people. Local and federal authorities want to make Dresden a center for semiconductor research and production.
Recall that Research firm predicts IHS Markit, the chip shortage will cut global production by more than 670,000 vehicles in the first quarter. Fitch Solutions predicts that some form of car chip shortage could persist until early 2023.