Wolfspeed plans another multibillion-dollar chip-making plant, this one in Germany

On an investor call last week, Wolfspeed CEO Gregg Lowe said demand for his company’s silicon carbide chips was so great that the company needed to have plans for another manufacturing facility “in place” sometime this year.

The public didn’t have to wait long. On Wednesday, the Durham-based Wolfspeed unveiled plans for a new plant in Saarland, Germany, adding to its ongoing projects, which include a forthcoming facility in Chatham County.

“This new facility will be crucial to supporting our expansion in a capacity-constrained industry that is growing very rapidly, especially across the EV marketplace,” Lowe said in a statement Wednesday. “It was important for us to have a facility located in the heart of Europe, near many of our customers and partners, to foster collaboration on the next generation of Silicon Carbide technologies.”

With its latest announcement, Wolfspeed says it has dedicated $6.5 billion to increase its manufacturing capacity. The company opened a new facility in Mohawk Valley, New York, last spring, and in September, Wolfspeed and North Carolina officials celebrated plans to build a materials plant on a megasite near Siler City.

Wolfspeed makes a particular type of chip made from silicon carbide, a semiconducting compound that the company first turns into thin blank chips called wafers. Wolfspeed then either sells these wafers to other chip manufacturers or sends them to its own fabrication factories, called fabs, where the company makes them into functioning chips.

“We literally can’t make enough,” said John Palmour, Wolfspeed’s late chief technology officer and cofounder, during an interview with The News & Observer in September.

The company will name the Siler City manufacturing plant after Palmour, who died in November.

Wolfspeed has a pair of existing fabs in Durham and one in New York. The newly announced German facility will also fabricate chips while the future Chatham site will produce the wafers.

In its statement Wednesday, the company said the first phase of construction on its Chatham facility will be completed by the end of fiscal year 2024. The statement then touted that this plant will multiply Wolfspeed’s wafer-production capabilities by at least a factor of 10.

Wolfspeed was founded in 1987 by a group of six men, five of whom were N.C State University graduate students. The company, which went by the name Cree until October 2021, has been eyeing expansion for months as the demand for electric vehicles, which use silicon chips, has swelled.

This story was produced with financial support from a coalition of partners led by Innovate Raleigh as part of an independent journalism fellowship program. The N&O maintains full editorial control of the work.

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