Market trends are a clear limestone of the technological macro-direction. As for the last big operation announced by the two players BorgWarner, global product in delivering innovative and sustainable mobility solutions for the vehicle market and Wolfspeed, top player in Silicon Carbide technology. BorgWarner will invest $500 million in Wolfspeed’s financing transaction, in exchange for a silicon carbide device capacity corridor. Under the multi-year agreement between BorgWarner and Wolfspeed, BorgWarner will be entitled to purchase up to $650 million of devices annually as BorgWarner requirements increase.
“Silicon carbide-based power electronics play an increasingly important role for our customers as our electric vehicle business continues to accelerate,” said Frédéric Lissalde, President and CEO of BorgWarner. “We believe this agreement helps ensure that BorgWarner will have a reliable supply of high-quality silicon carbide devices, which are significant to the company’s inverter growth plans”.
BorgWarner’s Charging Forward strategy targets $4.5 billion of electric vehicle revenue for 2025, compared to less than $350 million in 2021. Based on new business awards and acquisitions announced as of the Company’s third quarter earnings release, BorgWarner believes it is already on track to achieve approximately $4 billion of electric vehicle revenue by 2025.
Last month at the company’s Investor Day, Wolfspeed outlined a multi-year, $6.5 billion capacity expansion effort which included the installation of additional tools at the company’s state-of-the-art, 200mm Mohawk Valley fab and the construction of a 445-acre Silicon Carbide materials facility in North Carolina, which will expand the company’s existing materials capacity by more than 10x. The first phase of construction is slated to be complete by the end of FY2024.
