German powertrain supplier Vitesco Technologies has entered into a significant long-term supply agreement with US semiconductor manufacturer Onsemi. The deal, valued at €1.75 billion, spans over ten years and focuses on securing a steady supply of silicon carbide products, as the demand for e-mobility continues to surge.
The collaboration between Vitesco Technologies and Onsemi encompasses multiple aspects. Firstly, the companies have inked a supply agreement for silicon carbide products amounting to €1.75 billion. Additionally, they are jointly investing in expanding Onsemi’s manufacturing capacities, with Vitesco contributing €230 million. Lastly, the two companies are aiming to optimize drive inverters through their partnership.
Vitesco Technologies plans to utilize the SiC semiconductors, particularly the Onsemi EliteSiC MOSFET product, in inverters and drives for both existing orders and future projects. These silicon carbide components are known for enhancing the efficiency of inverters and drives, leading to improved performance, faster charging times, and increased range. Moreover, the reduced heat loss allows for smaller inverters and cooling systems, thereby minimizing energy requirements.
Onsemi counts prominent automakers such as Volkswagen, BMW, Hyundai-Kia, and Zeekr among its customers, and Vitesco Technologies is now joining this list as a major German supplier. Onsemi CEO Hassane El-Khoury highlights the collaboration’s significance in meeting customer demands for extended range and higher performance in electric vehicles. The company’s SiC technologies, developed through decades of experience in high-volume automotive applications, offer superior performance, quality, and supply assurance.
Andreas Wolf, CEO of Vitesco Technologies, emphasizes the growing demand for energy-efficient silicon carbide power semiconductors. He views the partnership with Onsemi as essential in securing access to the complete SiC value chain, ensuring a stable supply of this critical technology for the next decade and beyond.
Vitesco Technologies previously signed a cooperation agreement with Infineon in 2022 for the supply of silicon carbide power semiconductors, with intentions for joint development. However, specific financial details, supply scope, and agreement duration were not disclosed at the time. Additionally, Vitesco established a supply agreement for SiC chips with Rohm Semiconductor back in 2020.
In a recent update, Vitesco Technologies revealed its financial results for 2022. The company surpassed the significant milestone of €1 billion in turnover from electrification products alone. Last year, Vitesco generated around €1.1 billion from electric motors and related products, compared to €0.9 billion in 2021. The company expects electrification products to play an increasingly crucial role and contribute to the majority of its sales. In 2022, Vitesco received incoming orders totaling €14 billion, of which €10.4 billion were for electrification products. As of December 31, 2022, the company’s order backlog stood at €58.5 billion, with 46% of it in the electrification sector, indicating a strong upward trend.
