On February 27, Sanan Optoelectronics and STMicroelectronics held the Sanan-ST Microelectronics SiC Device Fab Inauguration Ceremony in Chongqing, marking a significant milestone in China's semiconductor industry. The new facility, which focuses on producing 8-inch silicon carbide (SiC) wafers for automotive applications, is expected to begin mass production in the fourth quarter of 2025. Once fully operational, the production line will be capable of manufacturing approximately 10,000 automotive-grade wafers per week, making it the first large-scale production line of its kind in China.

Established in August 2023, Sanan-STMicroelectronics is a joint venture between Sanan Optoelectronics (51% stake) and STMicroelectronics (China) Investment Co., Ltd. (49% stake). With a total investment of approximately RMB 23 billion, the project aims to build an annual production capacity of 480,000 8-inch SiC wafers, primarily targeting automotive power control chips. To support this initiative, Sanan Optoelectronics established Chongqing Sanan Semiconductor Co., Ltd. in July 2023, investing RMB 7 billion (approximately USD 3.16 billion) to construct a complementary 8-inch SiC substrate production line within the same industrial park. This substrate line commenced operations in September 2024.

The ceremony, held at the facility in Chongqing's High-Tech Zone, was attended by over 300 guests, including Chongqing Mayor Hu Henghua, industry leaders, supply chain partners, and representatives from both parent companies. Sanan Group Chairman Lin Xiucheng and STMicroelectronics President and CEO Jean-Marc Chery were among the key figures present, celebrating this landmark achievement.

Lin Kechuang, General Manager of Sanan Optoelectronics and Chairman of Sanan-STMicroelectronics, highlighted the project's rapid progress, noting that it took only 16 months to complete. He attributed this success to the supportive business environment fostered by the Chongqing municipal government, the collaborative efforts of both shareholders, and the dedication of the project team. Lin emphasized that the joint venture combines Sanan's expertise in SiC manufacturing with STMicroelectronics' leading-edge technology and market presence in power semiconductors, creating a strong foundation for future growth.

Jean-Marc Chery expressed optimism about the project's role in integrating STMicroelectronics' SiC solutions into China's new energy vehicle (NEV) ecosystem. He also underscored the importance of localized production in reducing import reliance and enhancing technical capabilities. Chery noted that SiC technology can enable NEVs to achieve a range of 600 kilometers and support 20-minute fast charging.

The joint venture is poised to address the growing demand for SiC power devices in China's rapidly expanding NEV market. Lin Kechuang projected that the domestic market for automotive SiC power devices would grow at a compound annual growth rate (CAGR) of 36% from 2022 to 2024, reaching RMB 22.16 billion by 2028. The adoption of SiC devices in NEVs is driven by their ability to improve charging efficiency and extend driving range.

Lin Zhidong, Director and Vice President of Sanan Optoelectronics, explained that the cost of SiC power devices is expected to drop by 40-50% within the next two years due to advancements in wafer size (from 4-inch and 6-inch to 8-inch), increased localization of equipment and materials, and improved yield rates across the production chain. He also revealed that Sanan's 6-inch SiC power device production base in Changsha supplies products to companies like Li Auto, while the Chongqing facility will produce wafers under the STMicroelectronics brand for the Chinese market.

Currently, domestic SiC power devices account for less than 10% of the automotive market, but adoption is accelerating. Lin Zhidong noted that these devices are now being integrated into NEVs priced as low as RMB 100,000, including models from BYD and XPeng.

According to TrendForce, China's SiC power device market is expected to grow from 1.8billion in 2024 to 2.2 billion in 2025, reaching $6.1 billion by 2030. The Sanan-STMicroelectronics project is set to play a pivotal role in meeting this demand, further solidifying Sanan Optoelectronics' position in the global SiC industry.