Chipmaker STMicroelectronics (ST) said it would build a silicon carbide wafer plant in Italy with an investment of 730 million euro ($728 million) as part of expanding its semiconductor manufacturing.
Franco-Italian ST said the new integrated silicon carbide (SiC) substrate manufacturing facility at its Catania site in Sicily would meet increasing demand from automotive and industrial customers amid a transition to electrification.
The five-year investment, due to be completed in 2026, will be supported with 292.5 million euros of public funds from Italy, as part of the country’s National Recovery and Resilience Plan, with the grant approved by the European Commission.
“The Italian measure approved today will strengthen Europe’s semiconductors supply chain, helping us deliver our green and digital transition,” European Commission Executive Vice-President Margrethe Vestager said in a separate statement.
Brussels’ Chips Act enabled 15 billion euros in public and private investment in the industry by 2030, on top of 30 billion euros of public investments already planned from NextGenerationEU, Horizon Europe and national budgets.
ST will build the new plant at its Catania site in Sicily, alongside an existing SiC device manufacturing facility. It will create around 700 additional jobs, the group said.
“This facility will be key to our vertical integration in SiC … as we further ramp up volumes to support our automotive and industrial customers in their shift to electrification and higher efficiency,” ST CEO Jean-Marc Chery said.
ST is expected start production in 2023, with a balanced supply of SiC substrate between internal and merchant supply.
STMicroelectronics reported 2022 second quarter revenues $3.84 billion; gross margin 47.4 percent; operating margin 26.2 percent; net income $867 million. STMicroelectronics is aiming for revenues of $4.24 billion and gross margin of 47 percent in Q3.
US-based chipmaker Intel has announced it will build a multibillion-euro chip factory in Italy and is in talks with Rome to sign a final deal and identify a suitable area for the investment.