China’s Sanan Optoelectronics announced that its subsidiary Hunan Sanan has signed a procurement letter of intent (LOI) agreement to supply silicon carbide (SiC) chips worth US$524m over the next few years for the new electric vehicle (NEV) product line of a strategic automotive partner. Hunan Sanan’s SiC technology will provide energy for the NEV power system for medium- and high-voltage platforms.

“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,” says Hunan Sanan’s general manager Tony Chiang. “The agreement ensures a long-term supply of SiC to our customers to help them realize their promise of low-carbon, smart mobility.”

The SiC chips will be manufactured in Hunan Sanan’s mega fab in Changsha, the first vertically integrated SiC wafer manufacturing service platform in China, which provides an in-house supply chain from SiC crystal, substrate, epitaxy, chip manufacturing, packaging, and testing, with a committed annual production capacity of 500,000 SiC 6-inch wafers. Hunan Sanan recently obtained IATF 16949 system certification, while the automotive-grade SiC MOSFETs have been verified with the cooperation of strategic partners, and are expected to be released in production in 2024. Sike Semiconductor, a company jointly established by Hunan Sanan and Li Auto, also officially started construction in August and is expected to begin production in 2024 with a planned annual production capacity of 2.4 million half-bridge SiC power modules.