German conglomerate Bosch announced this spring that it was teaming up with Daimler to work on self-driving cars, which it expected to become a reality within five years.

Now, Bosch is taking a step towards making those cars a reality.

Bosch announced Monday that it plans to build a new $1.1 billion semi-conductor plant in Dresden, which is scheduled to complete construction in 2019, with manufacturing to get underway in 2021. According to a Bloomberg News account, the plant will manufacture chips for self-driving cars.

The plant will employ as many as 700 workers.

A big undertaking

The new plant has been described by Dr. Volkmar Denner, Bosch’s chairman of the board, as “the biggest single investment in Bosch’s more than 130-year history.”

“Semiconductors are the core components of all electronic systems,” Denner added. “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.”

The factory will also develop chips for smart home and other Internet of Things-related technologies.

 “Silicon Saxony”

The plant will be built in the high-tech region of Germany that’s been dubbed “Silicon Saxony.” It’s the highest concentration of high-tech manufacturing anywhere in Europe.

The Bosch Background

Bosch, known formally as Robert Bosch GmbH, dates back to 1886, and has been known throughout its history as an engineering firm. More recently, it has been known both for its work as a car parts supplier and for its work with software.

Bosch’s North American headquarters is located in Farmington Hills, Mich., and it operates Research Technology Centers in Pittsburgh, Palo Alto and Cambridge, Mass.

Bosch’s Big Gamble

Daimler and Bosch’s ambitious plans for self-driving cars are similar in some ways to those of Ford, GM and various other competitors. According to a report on, the Daimler/Bosch plan for autonomous cars will focus on urban ride sharing.

Daimler, earlier this year, signed a separate deal with Uber to work on self-driving cars for that company.