STMicroelectronics and San'an Optoelectronics Promote the Development of China's Silicon Carbide Ecosystem

STMicroelectronics, a global leading semiconductor company serving multiple electronic applications, and San'an Optoelectronics, a leading Chinese compound semiconductor enterprise (covering LED, silicon carbide, optical communication, RF, filters, gallium nitride and other products) announced that the two sides had signed an agreement to establish a new 8-inch silicon carbide device joint venture manufacturing plant in Chongqing, China. The new SiC manufacturing plant is scheduled to begin production in the fourth quarter of 2025 and is expected to be fully completed by 2028, which will better support China's growing demand for automotive electrification, industrial power, and energy applications. Meanwhile, Sanan Optoelectronics will utilize its own SiC substrate process to build and operate a new 8-inch SiC substrate manufacturing plant separately to meet the substrate needs of the joint venture.

The joint venture will use ST's patented SiC manufacturing process technology to produce SiC devices specifically for ST, as ST's dedicated wafer foundry to meet the needs of its Chinese customers.

The total construction amount of the joint venture plant is estimated to be about 3.2 billion US dollars, of which the capital expenditure in the next five years is about 2.4 billion US dollars. The capital sources include the capital investment from STMicroelectronics and San'an Optoelectronics, the support from Chongqing government and the external loan from the joint venture.

Lin Kechuang, CEO of Sanan Optoelectronics, stated: "The establishment of the joint venture will strongly promote the widespread adoption of SiC devices in the Chinese market. As an internationally renowned high-quality SiC Foundry model service company, San'an will also build a new SiC substrate factory to provide SiC substrates for the newly established joint venture factory. This is an important step for San'an Optoelectronics towards the goal of becoming a professional SiC wafer foundry. With the establishment of the new joint venture factory and the capacity expansion of the new SiC substrate factory, we We are confident that San'an will continue to occupy a dominant position in the SiC professional Foundry model market ".

Jean Marc Chery, president and CEO of STMicroelectronics, said: The automotive and industrial sectors in China are moving towards electrification at full speed, and ST has successfully won many customer projects in this market. For ST, establishing a dedicated wafer factory with important local partners in China will help us meet the growing needs of Chinese customers in the most efficient way. The future 8-inch substrate manufacturing plant of Sanan Optoelectronics, the newly established front-end joint venture manufacturing plant of both parties, and the Combined with ST's existing back-end manufacturing plant in Shenzhen, China, ST will be able to provide our Chinese customers with a fully Vertical integration SiC value chain. This move will become an important step in further expanding ST's global SiC manufacturing business, in addition to its continued significant investments in Italy and Singapore. The new joint venture factory will assist ST in achieving its goal of achieving SiC revenue of over $5 billion by 2030. This measure is also in line with ST's revenue target of over $20 billion between 2025 and 2027, as well as the relevant financial model we previously communicated to the capital market