Cree, a global provider of silicon carbide technology through its Wolfspeed business, and STMicroelectronics, a global semiconductor leader serving customers across the spectrum of electronics applications, announced the expansion of an existing multi-year, long-term silicon carbide wafer supply agreement. The amended agreement, which calls for Cree to supply ST with 150mm silicon carbide bare and epitaxial wafers over the next several years, is now worth more than $800 million.
Jean-Marc Chery, President and CEO of STMicroelectronics said that this latest expansion to their long-term wafer supply agreement with Cree will continue to contribute to the flexibility of their global silicon carbide substrate supply, complementing the other external capacity they have secured and the internal capacity they are ramping. The agreement will help meet the high volumes required by their product manufacturing operations in the next few years, with a large number of automotive and industrial customer programs in high volumes or ramping up.
The adoption of silicon carbide-based power solutions is rapidly growing across the automotive market as the industry moves from internal combustion engines to electric vehicles, enabling greater system efficiencies that result in electric cars with longer range and faster charging, while reducing cost, lowering weight and conserving space. In the industrial market, silicon carbide solutions enable smaller, lighter and more cost-effective designs, converting energy more efficiently to unlock new clean energy applications. To better support these growing markets, device manufacturers are interested in securing access to high-quality silicon carbide substrates to support their customers.
Cree CEO Gregg Lowe stated that they are very pleased that STMicroelectronics will continue to leverage Wolfspeed silicon carbide materials as part of their supply strategy for the next several years. Their long-term wafer supply agreements with device manufacturers now total more than $1.3 billion and help support their efforts to drive the industry transition from silicon-to-silicon carbide. Their partnerships and significant investments in increased production capacity ensure they are well-positioned to capitalize on what they believe to be is a multi-decade growth opportunity for silicon carbide-based applications.