Semiconductor Equipment

US domestic SiC manufacturing expands with Wolfspeed deal

16 October 2024
An artist’s rendering of Wolfspeed’s John Palmour Manufacturing Center for Silicon Carbide fab that will be in Siler City, North Carolina. Wolfspeed already has a deal in place with Renesas to provide the company with wafers from the center. Source: Wolfspeed

Looking to boost production of wide bandgap semiconductors domestically, the U.S. Department of Commerce (DoC), through the CHIPS and Science Act, has signed a deal with WolfSpeed Inc. to support the construction of a new silicon carbide (SiC) wafer manufacturing facility in Siler City, North Carolina.

With demand for wide bandgap technologies, particularly SiC, soaring — due to their use in emerging applications like renewable energy and electric vehicles (EVs) — Wolfspeed has been investing to expand its supply of SiC chips globally. This includes the construction of its first European SiC fab announced in August of last year and a whopping 10-year agreement with Renesas Electronics Corp. to expand SiC bare and epitaxial wafers to the tune of $2 billion.

Additionally, earlier this year, Wolfspeed expanded its agreement with Infineon Technologies to supply SiC wafers in a multi-year capacity reservation deal.

The deal with Renesas is interesting because it involves the construction of the Siler City facility that the will be funded in part by the CHIPS Act. The John Palmour Manufacturing Center for Silicon Carbide will supply 200 mm SiC bare and epitaxial wafers to Renesas from this facility. It will likely supply other vendors as well.

In total, Wolfspeed plans to invest about $6.5 billion in capital expenditures through 2027 with the John Palmour center being one investment. Other investments include:

  • Expanding its Durham, North Carolina, materials facility.
  • Ramping its 200 mm SiC fab in Marcy, New York.
  • A second planned 200 mm fab in Saarland, Germany.
  • Establishing multi-site epitaxy footprint at Farmers Branch, Texas.​

Direct funding

Under the deal with the DoC, Wolfspeed will receive up to $750 million through the CHIPS Act. While the construction of the Joun Palmour center is the largest part of the investment, the funding will also help with its Marcy, New York, facility expansion.

These projects will create more than 2,000 manufacturing jobs and 3,000 construction jobs.

The 2 million square foot facility will become the largest SiC wafer facility and the world’s first high-volume 200 mm SiC wafer manufacturing facility, Wolfspeed said. The Marcy, New York, facility would become the first fully automated 200 mm SiC power device fab and increase production capacity by about 30%. The fab will be used for both automotive, industrial and energy users.

Overall, Wolfspeed said these investments will increase SiC device output by five times and there will be a 10 times increase in 200 mm materials production capacity.

Why SiC?

Compared to silicon, SiC lowers system costs and improves performance. The Department of Energy said SiC was one of the 17 critical materials with a high risk of supply disruption and integral to clean energy technologies.

The DoC said that SiC semiconductors are critical to national security.

Why it matters

The overall SiC market from EV production is forecast to reach revenues of $9.6 billion by 2030, managing a compound annual growth rate (CAGR) of a whopping 37% through 2027, according to research from TechInsights.

The overall power market for automotive devices — power MOSFETs, IGBT and SiC semiconductors — is set to reach revenues of $26.6 billion by 2030. This is nearly double the revenue this sector generated in 2023. In the next five-year period, the power chip market for automotive is forecast to manage a CAGR of 16.0%.

The use of SiC will depend on the type of EV that is being manufactured.

For mild hybrids, the segment will continue to lean on the use of silicon MOSFETs, however, there may be some use of GaN technology if the price point can be reduced to match current MOSFETs. In full hybrids and plug-in hybrids, wide bandgap technologies like SiC and GaN will not be ideal due to the cost effectiveness of mainstream silicon IGBT and MOSFET technologies, TechInsights said.

Full battery EVs will be the main driver for SiC chips in the main inverter and this will be joined by increasing use across power electronics systems like DC-DC converters and on-board chargers. While the SiC chips are much more expensive than other technologies, the advantages the technologies offer in a reduction in size and weight as well as system performance and battery life will help lead to greater penetration of EVs in the long run.

Not surprisingly, Wolfspeed isn’t the only company working to expand its supply of wide bandgap chip technologies as numerous other companies are rapidly expanding manufacturing globally like:

  • Onsemi
  • ST Microelectronics
  • Texas Instruments
  • Skyworks
  • Bosch
  • X-Fab
  • Soitec
  • Infineon
  • Globalfoundries
  • Entegris
  • Nexperia
To contact the author of this article, email PBrown@globalspec.com


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