STMicro, Soitec Deepen Cooperation Over Fast-Growing Semiconductor Material

French semiconductor materials supplier Soitec and chipmaker STMicroelectronics said on Thursday they were deepening their cooperation over the manufacturing of a key and fast-growing material used in the electric car industry.

The material, silicon carbide (SiC), is used to make a growing number of chips that improve the power management of electric vehicles.

It is also a driver of growth for the two firms, which have benefited lately from a global chip shortage and the subsequent rise in demand and prices.

Under the enhanced cooperation, STMicro, whose biggest clients include EV maker Tesla Inc, agreed to use  Soitec's SiC substrate technology, in the form of a bigger, 200 millimetre wafer which is upcoming, the two companies said in a statement.

The so-called qualification of Soitec's new substrate by STMicro over the next 18 months means that the Franco-Italian chipmaker will be able to manufacture the technology itself, as it needs to ramp up production of SiC chips.

"This will help accelerating the adoption of electric cars," Soitec's chief executive, Pierre Barnabe, said, adding that 200mm wafers enable the manufacturing of more components and improve the charging capabilities of cars.

While not exclusive, the Soitec-STMicro cooperation gives STMicro a time advantage in the adoption of the technology.

STMicro is aiming to sell $700 million worth of SiC chips this year and is targeting $1 billion in 2023, it has said.

The Geneva-based group said in October it will build a 730 million-euro silicon carbide wafer plant in Italy, the first such project approved as part of a European Union drive to bring more chip production closer to home.