Hunan Sanan secures order worth $524 million
Hunan Sanan, a Sanan Optoelectronics subsidiary, has signed a procurement letter of intent (LOI) agreement with an automotive partner. Under the agreement, Hunan Sanan will supply USD 524 million worth of SiC chips to the automaker's new electric vehicle product line in the next few years.
The SiC chips in the agreement will be manufactured in the Hunan Sanan's fab in Changsha, the first vertically integrated SiC wafer manufacturing service platform in China. The fab has a committed annual production capacity of 500,000 silicon carbide 6-inch wafers.
"Our agreement with this strategic partner further demonstrates the automotive industry's commitment to providing innovative electrification experience to the market and leveraging the advantages of wide bandgap semiconductors to improve overall vehicle performance. The agreement ensures a long-term supply of SiC to our customer to help them realize their promise of low-carbon, smart mobility," says Tony Chiang, General Manager of Hunan Sanan, in a press release.
Sike Semiconductor, a company jointly established by Hunan Sanan and Li Auto, also officially started construction this past August and is expected to start production in 2024 with a planned annual production capacity of 2.4 million half-bridge SiC power modules.
According to a market report by YoleDevelopment, the silicon carbide power device market will surge from USD 1 billion in 2021 to USD 6.3 billion in 2027, driven by the new energy vehicle market (NEV). However, due to the gap between the high demand of NEVs and the expansion of SiC substrate manufacturing, the supply of silicon carbide chips will be in shortage in the short term.
