Sanan Optoelectronics and STMicroelectronics in EV Chipmaking Venture

China’s Sanan Optoelectronics (600703.SH) and Europe’s STMicroelectronics NV agreed to jointly invest $3.2 billion in a Chongqing factory to produce semiconductor devices for electric vehicles, STMicroelectronics said Wednesday.

The joint venture will make silicon carbide devices. Chips made with silicon carbide transistors are widely used in electric vehicles as they withstand higher temperatures, have a longer life and are more energy-efficient than semiconductors made with silicon power transistors. Electric-car makers including Tesla, BYD and NIO use silicon carbide devices in some models.