onsemi Selects the Czech Republic to Establish End-to-End Silicon Carbide Production for Advanced Power Semiconductors

Brownfield investment would bring critical manufacturing capabilities of energy efficient chips to Central Europe to power the future of electrification, renewables and AI

NEWS HIGHLIGHTS

• onsemi’s planned multi-year investment of up to $2 billion would solidify advanced power semiconductor supply chain for its European and global customer base
• Vertically integrated silicon carbide site brings advanced packaging capabilities to the region and best positions onsemi to meet rising demand for clean, energy efficient semiconductor solutions
• onsemi is cooperating with the government of the Czech Republic to prepare an incentive package that would support the investment
• The investment would be one of the largest private sector investments in the Czech Republic’s history and one of the first investments in advanced semiconductor manufacturing in Central Europe

Electrification, renewables and artificial intelligence are global megatrends converging and driving unprecedented demands for advanced power semiconductors capable of optimizing energy conversion and management. In a strategic move toward addressing these demands, onsemi announced plans to establish a state-of-the-art, vertically integrated silicon carbide (SiC) manufacturing facility in the Czech Republic. The site would produce the company’s intelligent power semiconductors that are essential for improving the energy efficiency of applications in electric vehicles, renewable energy and AI data centers.

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onsemi facility in Rožnov pod Radhoštěm in the Czech Republic (Graphic: Business Wire)

"Our brownfield investment would establish a Central European supply chain to better service our customers’ rapidly increasing demand for innovative technologies that improve the energy efficiency in their applications,” said Hassane El-Khoury, president and CEO, onsemi. “Through a close collaboration with the Czech government, the expansion would also enhance our production of intelligent power semiconductors that are essential to helping ensure the European Union is able to achieve its ambitions to significantly reduce carbon emissions and environmental impact.”

“onsemi’s decision to expand in Czechia is a clear confirmation of our country’s attractiveness for foreign investment and will bring significant momentum for the development of our economy,” said Mr. Jozef Síkela, Minister of Industry and Trade of the Czech Republic. “This investment not only strengthens our position in the semiconductor field but can also contribute to the development of the automotive industry and help us with its adaptation to the rise of electromobility.”

onsemi's Commitment to Europe and the Czech Republic

onsemi’s plan to expand SiC manufacturing with a multi-year brownfield investment of up to $2 billion (44 billion CZK) is part of the company’s previously disclosed long-term capital expenditure target. This investment would build on the company’s current operations in the Czech Republic, which include silicon crystal growth, silicon and silicon carbide wafer manufacturing (polished and EPI) and a silicon wafer fab. Today, the site can produce more than three million wafers annually, including more than one billion power devices. Upon completion, the operation would contribute annually more than $270 million USD (6 billion CZK) to the country’s GDP.

Pending all final regulatory and incentive approvals¹, this would be one of the largest private sector investments in the Czech Republic’s history and would further contribute to the prosperity and economic dynamism of the Zlín region. onsemi is one of the first companies to invest in advanced semiconductor manufacturing in the Central European region. With this investment, the company would contribute to the strategic positioning of the region within the EU’s semiconductor value chain and demonstrate that all EU countries can benefit from the European Chips Act. The announcement also reflects onsemi's strategic alignment with the overarching goals of the European Chips Act of increasing market share and technological advancement to strengthen the resilience of the EU’s semiconductor supply chains in times of ever-growing demand.

Driving Innovation in Power Semiconductors

Silicon carbide is a critical material for high-power, high-temperature applications, and is extremely difficult to produce. onsemi is one of the only companies in the world with the ability to manufacture SiC-based semiconductors from crystal growth to advanced packaging solutions. By expanding its production facilities in the Czech Republic, onsemi would be faster to provide supply assurance for customers, strengthening its leadership in intelligent power solutions. This integration would also enable onsemi to leverage its latest advancements in research and development (R&D) to maximize manufacturing and production efficiency.

¹ Including the investment incentive approval by the government of the Czech Republic and its notification to the European Commission

About onsemi

onsemi (Nasdaq: ON) is driving disruptive innovations to help build a better future. With a focus on automotive and industrial end-markets, the company is accelerating change in megatrends such as vehicle electrification and safety, sustainable energy grids, industrial automation, and 5G and cloud infrastructure. onsemi offers a highly differentiated and innovative product portfolio, delivering intelligent power and sensing technologies that solve the world’s most complex challenges and leads the way to creating a safer, cleaner and smarter world. onsemi is recognized as a Fortune 500^® company and included in the Nasdaq-100 Index^® and S&P 500^® index. Learn more about onsemi at www.onsemi.com.

onsemi and the onsemi logo are trademarks of Semiconductor Components Industries, LLC. All other brand and product names appearing in this document are registered trademarks or trademarks of their respective holders.

This document includes “forward-looking statements,” as that term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, included or incorporated in this document could be deemed forward-looking statements, particularly statements about onsemi’s planned investments in the Czech Republic, pending regulatory and incentive approvals and potential contributions to the Czech Republic’s GDP. Forward-looking statements are often characterized by the use of words such as “believes,” “estimates,” “expects,” “projects,” “may,” “will,” “intends,” “plans,” “anticipates,” “should” or similar expressions or by discussions of strategy, plans or intentions. All forward-looking statements in this document are made based on our current expectations, forecasts, estimates and assumptions and involve risks, uncertainties and other factors that could cause results or events to differ materially from those expressed in the forward-looking statements. Certain factors that could affect our future results or events are described under Part I, Item 1A “Risk Factors” in the 2023 Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 5, 2024 (the “2023 Form 10-K”) and from time to time in our other SEC reports. Readers are cautioned not to place undue reliance on forward-looking statements. We assume no obligation to update such information, which speaks only as of the date made, except as may be required by law. Investing in our securities involves a high degree of risk and uncertainty, and you should carefully consider the trends, risks and uncertainties described in this document, our 2023 Form 10-K and other reports filed with or furnished to the SEC before making any investment decision with respect to our securities. If any of these trends, risks or uncertainties actually occurs or continues, our business, financial condition or operating results could be materially adversely affected, the trading prices of our securities could decline, and you could lose all or part of your investment. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by this cautionary statement.

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