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ROHM Group Company SiCrystal and STMicroelectronics have expanded their silicon carbide wafer supply agreement to support device manufacturing capacity ramp-up for automotive and industrial customers worldwide. The agreement is valued at a minimum of $230 million for larger volumes of 150mm SiC substrate wafers manufactured in Nuremberg, Germany.
La società del Gruppo ROHM, SiCrystal, e STMicroelectronics hanno ampliato il loro accordo di fornitura di wafer in carburo di silicio per sostenere l'incremento della capacità di produzione di dispositivi destinati ai clienti automobilistici e industriali in tutto il mondo. L'accordo ha un valore minimo di 230 milioni di dollari per volumi maggiori di wafer di substrato SiC da 150mm prodotti a Norimberga, Germania.
La empresa del Grupo ROHM, SiCrystal, y STMicroelectronics han ampliado su acuerdo de suministro de obleas de carburo de silicio para apoyar el aumento de la capacidad de fabricación de dispositivos para clientes de automoción e industriales a nivel mundial. El acuerdo está valorado en un mínimo de 230 millones de dólares para volúmenes más grandes de obleas de sustrato de SiC de 150mm fabricadas en Nuremberg, Alemania.
로옴 그룹 회사인 시크리스탈과 ST마이크로일렉트로닉스는 전 세계 자동차 및 산업 고객을 위한 장치 제조 능력 확대를 지원하기 위해 실리콘 카바이드 웨이퍼 공급 계약을 확대하였다. 이 계약은 독일 뉘른베르크에서 생산된 150mm SiC 기판 웨이퍼의 더 큰 양에 대해 최소 2억 3천만 달러의 가치가 있다.
La compagnie du groupe ROHM, SiCrystal, et STMicroelectronics ont élargi leur accord d'approvisionnement en plaquettes de carbure de silicium pour soutenir l'augmentation de la capacité de fabrication de dispositifs pour les clients automobiles et industriels dans le monde entier. L'accord est évalué à un minimum de 230 millions de dollars pour des volumes plus importants de plaquettes de substrat SiC de 150 mm fabriquées à Nuremberg, en Allemagne.
Die ROHM Group-Firma SiCrystal und STMicroelectronics haben ihre Siliziumkarbid-Wafer-Liefervereinbarung ausgeweitet, um die Produktionskapazität für Geräte für Automobil- und Industriekunden weltweit zu erhöhen. Der Vertrag hat einen Mindestwert von 230 Millionen Dollar für größere Mengen von 150mm SiC-Substratwafern, die in Nürnberg, Deutschland, hergestellt werden.
Positive
Expansion of silicon carbide wafer supply agreement to support device manufacturing capacity ramp-up
Minimum expected value of $230 million for larger volumes of 150mm SiC substrate wafers
Focus on supporting automotive and industrial customers worldwide with energy-efficient SiC power semiconductors
Strengthening supply chain resilience for future growth
Facilitating cleaner mobility solutions and greener energy future
Negative
None.
Insights
The expansion of the supply agreement between ROHM's SiCrystal and STMicroelectronics to increase the production and supply of 150mm silicon carbide (SiC) wafers represents a strategic move for both companies. This decision aligns with the growing demand for SiC components, particularly in sectors like automotive and industrial electronics where energy efficiency is paramount. The use of SiC in these sectors can lead to significant improvements in performance due to SiC's superior thermal conductivity and high-temperature resilience compared to traditional silicon. The financial commitment of at least $230 million not only underpins the confidence both companies have in the SiC market growth projections but also signals to investors the level of demand and the potential revenue stream from these components. With this agreement, STMicroelectronics is likely to secure a steady supply chain which is important for maintaining production without incurring shortages that could halt or delay manufacturing lines.
From an investment perspective, the agreement between SiCrystal and STMicroelectronics is a proactive step towards securing a significant share in the SiC market, which is expanding due to its critical role in the next generation of power semiconductors. The deal, valued at a minimum of $230 million, suggests that STMicroelectronics anticipates considerable demand for its SiC-based products. For investors, consistency in supply agreements such as this can often lead to more predictable financial outcomes, potentially translating into stable stock valuations. Moreover, the investment in SiC technology underscores a long-term strategy to capture market share in the electric vehicle and renewables sectors which are poised for growth. However, investors should consider the capital expenditures associated with ramping up production capacity and whether the market demand will continue to rise without oversupply.
The enhanced focus on SiC substrates from companies like SiCrystal and STMicroelectronics is very relevant for investors interested in the automotive sector, especially considering the shift towards electric vehicles (EVs). SiC components are critical in manufacturing efficient power electronics for EVs, improving range and reducing charging times. Given the stringent emission regulations and the push for electrification, the automotive industry's adoption of SiC technology is anticipated to escalate. This agreement is an indicator of industry trends and the anticipated trajectory of demand for such components. Investors should monitor the adoption rates of EVs and the integration of SiC-based power systems in new models, as these factors could substantially affect the future revenue streams for companies like STMicroelectronics.
ROHM Group Company SiCrystal and STMicroelectronics Expand Silicon Carbide Wafer Supply Agreement
Kyoto, Japan and Geneva, Switzerland, April 22, 2024 – ROHM (TSE: 6963) and STMicroelectronics (NYSE: STM), a global semiconductor leader serving customers across the spectrum of electronics applications, announced today the expansion of the existing multi-year, long-term 150mm silicon carbide (SiC) substrate wafers supply agreement with SiCrystal, a ROHM group company. The new multi-year agreement governs the supply of larger volumes of SiC substrate wafers manufactured in Nuremberg, Germany, for a minimum expected value of $230 million.
Geoff West, EVP and Chief Procurement Officer, STMicroelectronics, commented “This expanded agreement with SiCrystal will bring additional volumes of 150mm SiC substrate wafers to support our devices manufacturing capacity ramp-up for automotive and industrial customers worldwide. It helps strengthen our supply chain resilience for future growth, with a balanced mix of in-house and commercial supply across regions”.
“SiCrystal is a group company of ROHM, a leading company of SiC, and has been manufacturing SiC substrate wafers for many years. We are very pleased to extend this supply agreement with our longstanding customer ST. We will continue to support our partner to expand SiC business by ramping up 150mm SiC substrate wafer quantities continuously and by always providing reliable quality”. said Dr. Robert Eckstein, President and CEO of SiCrystal, a ROHM group company.
Energy-efficient SiC power semiconductors enable electrification in the automotive and industrial sectors in a more sustainable way. By facilitating more efficient energy generation, distribution and storage, SiC supports the transition to cleaner mobility solutions, lower emissions industrial processes and a greener energy future, as well as more reliable power supplies for resource-intensive infrastructure like data centers dedicated to AI applications. More information about the advantages of SiC is available on ST.com: https://www.st.com/content/st_com/en/about/innovation---technology/SiC.html
About STMicroelectronics At ST, we are over 50,000 creators and makers of semiconductor technologies mastering the semiconductor supply chain with state-of-the-art manufacturing facilities. An integrated device manufacturer, we work with more than 200,000 customers and thousands of partners to design and build products, solutions, and ecosystems that address their challenges and opportunities, and the need to support a more sustainable world. Our technologies enable smarter mobility, more efficient power and energy management, and the wide-scale deployment of cloud-connected autonomous things. We are committed to achieving our goal to become carbon neutral on scope 1 and 2 and partially scope 3 by 2027.
About ROHM Founded in 1958, ROHM provides ICs and discrete semiconductor devices characterized by outstanding quality and reliability for a broad range of markets, including automotive, industrial equipment and consumer market via its global development and sales network. In the analog power field, ROHM proposes the suitable solution for each application with power devices such as SiC and driver ICs to maximize their performance, and peripheral components such as transistors, diodes, and resistors.
Further information on ROHM can be found at www.rohm.com
About SiCrystal SiCrystal, a ROHM group company, is one of the global market leaders for monocrystalline silicon carbide wafers. SiCrystal’s advanced semiconductor substrates provide the basis for the highly efficient use of electrical energy in electric vehicles, fast charging stations, renewable energies and in various fields of industrial applications.
Further information on SiCrystal can be found at www.sicrystal.de
What is the value of the expanded silicon carbide wafer supply agreement between SiCrystal and STMicroelectronics?
The agreement is valued at a minimum expected value of $230 million for larger volumes of 150mm SiC substrate wafers.
Where are the 150mm SiC substrate wafers manufactured?
The 150mm SiC substrate wafers are manufactured in Nuremberg, Germany.
What is the focus of the expanded agreement between SiCrystal and STMicroelectronics?
The focus is on supporting device manufacturing capacity ramp-up for automotive and industrial customers worldwide.
How does SiC support the transition to cleaner mobility solutions and greener energy future?
SiC enables electrification in the automotive and industrial sectors in a more sustainable way, facilitating cleaner mobility solutions, lower emissions industrial processes, and a greener energy future.
