STMicroelectronics has committed to invest 5 billion euros ($5.4 billion) to build the world’s first fully integrated silicon carbide (SiC) factory in Italy. The plan is supported by 2 billion euros from the Italian government and is the result of the EU’s “Chip Act”, which aims to provide support for the European chip industry.
STMicroelectronics
European Commission approves Italian state aid on Friday STMicroelectronics A €5 billion ($5.4 billion) microchip factory will be built as Europe strives to reduce its dependence on Asian imports of vital manufacturing parts.
The French-Italian semiconductor maker’s planned factory in Catania, Sicily, will receive about 2 billion euros in direct funding from Rome to produce specialized chips that can improve the energy efficiency of electric vehicles.
Massive supply chain disruptions during the pandemic and rising trade tensions with China have heightened scrutiny of Europe’s dependence on Asian chip supplies, with recent disruptions to the Red Sea trade route adding to concerns.
Also available in the United States huge incentives try Attract chip manufacturersthe EU also made its own response chip methodseeking to do the same for parts critical to high-tech industries ranging from computers to car manufacturing.
EU antitrust chief Margrethe Vestager said the approved state aid demonstrated the EU’s determination to ensure the supply of such materials.
“I think it’s very important that we do this because it also sends a signal to the rest of the world that you shouldn’t build capabilities and think you can own this market because it makes strategic sense for us not to rely on a single supplier.” Stagg told a press conference in Catania.
U.S. stocks fell on Thursday, led by technology stocks, after a disappointing forecast from Salesforce.
The Italian and French governments are the major shareholders of STMicroelectronics, jointly holding 27.51% of the shares.
The new factory will be the group’s second on the Italian island.
“The Catania campus will help reverse the trend of over-reliance on imported equipment that is particularly relevant to Europe’s digital and green transition goals,” the European Commission said in a statement.
The STMicroelectronics factory will produce wafers made of silicon carbide, which is more energy-efficient than standard silicon.
The company’s plans signal that it believes recent weakness in the EV market is temporary and that silicon carbide wafers will be more widely adopted by automakers.
The European Commission said having a large, integrated European silicon carbide wafer manufacturing and packaging facility would have “widespread positive impacts on the European semiconductor ecosystem” and help ensure regional supply security.
The plant is expected to be fully operational by 2032.
STMicroelectronics is the largest maker of silicon carbide wafers, which cost more to make than regular silicon wafers but are favored by automakers because they are energy efficient, lightweight and strong.
The company’s clients include Tesla, BYD, BMW and Renault.
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