SK Siltron CSS has started a $300 million expansion to bolster semiconductor, electric vehicle supply chain
Expansion is part of broader SK Group plans to invest $30 billion and create 16,000 new U.S. jobs
Chey Tae-won, chairman of SK Group, “We are committed to helping reduce carbon emissions through U.S. investments focused on eco-friendly businesses.”
BAY COUNTY, Mich., March 16, 2022 – U.S. Trade Representative Katherine Tai and South Korea’s Trade Minister Yeo Han-koo commemorated today the 10th anniversary of the U.S.-Korea Free Trade Agreement (KORUS) with a visit to SK Siltron CSS, a U.S. subsidiary of South Korea’s SK Group. The visit also recognized the expansion of SK Siltron CSS’ Michigan operations that will support the fast-growing electric vehicle industry.
SK Siltron CSS produces a semiconductor wafer – a thin disc of
silicon carbide crystal – that can be used to make semiconductor chips
for components in electric vehicles. It recently began a $300 million
expansion that will add a second R&D and manufacturing site in Bay
County, Mich., and create up to 150 additional U.S. jobs, doubling its
Michigan workforce and quadrupling manufacturing capacity in the next
few years to meet increasing demand for EVs. The company has an existing
site in Auburn, Mich., with a second site under development in nearby
Bay City, Mich.
Ambassador Tai and Trade Minister Yeo met with top executives from SK Siltron,
the parent company of SK Siltron CSS. SK Siltron, and its subsidiaries,
are part of SK Group, South Korea’s second-largest conglomerate.
The tour and meetings marked the 10th anniversary of KORUS,
a milestone free trade agreement that went into effect in March 2012.
By allowing most industrial and consumer goods to flow between the U.S.
and South Korea without tariffs, the agreement continues to strengthen
economic ties between the allied nations.
“Beyond increased exports, the Agreement has also strengthened the investment ties between our two countries and that’s why I’m here today,” Ambassador Tai said at the event. “I am particularly excited that SK will be investing $300 million in Bay County over the next several years, which will double the number of people they employ in the state and increase our semiconductor production capacity. This partnership between our two countries is an excellent example of how we can harness the innovation and talent of our citizens to create a cleaner, more sustainable economy – while also creating good-paying jobs.”
Trade Minister Yeo commented on the positive impact for both nations as well.
“SK Siltron CSS is an exemplary case of mutually win-win investment cooperation between South Korea and the United States in the global supply chain, based on the decade-long Korea-U.S. Free Trade Agreement framework,” Trade Minister Yeo said. “We will continue to support cooperation with the United States to build a more resilient global supply chain in new industries, such as semiconductors as well as EV batteries and biopharmaceuticals.”
South Korea is one of the ten largest trading partners for the U.S. and a major source of foreign direct investment in U.S. businesses. In 2020 alone, foreign direct investment by Korean companies in the U.S. totaled more than $60 billion with Korea-based companies supporting more than 94,500 jobs in the U.S., according to U.S. Department of Commerce data.
“SK Siltron is honored to represent how positive Korea-U.S. trade relations are creating jobs, driving investments and building supply chains critical to our global economy,” said SK Siltron CEO Jang Yong Ho. “SK Siltron CSS and its Michigan team members, with the highest standards for quality and performance, are playing an important role in supplying the advanced materials needed to support the growth of EVs and speed the transition to more environmentally-friendly vehicles.”
Last December, SK Group Chairman Chey Tae-won presented his vision of SK’s broader contributions to addressing global climate change during a Trans-Pacific Dialogue (TPD) event in Virginia. The event was sponsored by the Chey Institute for Advanced Studies.
“SK Group is not only committed to creating jobs but also contributing to the reduction of carbon emissions in the U.S. and around the world,” Chey said. “SK’s investments in the United States are centered on eco-friendly businesses that help address global climate change and have a positive impact on the environment.”
SK Group Planning $30B in U.S. Investments
In addition to SK Siltron, other SK Group companies are ramping up U.S. expansion plans. Across its companies, SK Group plans to invest more than $30 billion and create more than 16,000 new jobs in the U.S. by the end of 2025. The new investments are largely focused on supporting innovative industries and technologies to support a sustainable future. Investments and expansions by other SK Group companies include:
SK On, one of world’s top makers of EV batteries, is investing $4.45 billion to build EV battery plants in Kentucky and Tennessee through the Blue Oval SK joint venture with Ford Motor Co. SK On’s first U.S. EV battery plant has been built and is in operation in Georgia with a second plant under construction at the same site as part of a $2.6 billion investment.
SK E&S, another SK Group energy company, and SK Inc. jointly invested last year $1.6 billion in Plug Power, a New York-based leading hydrogen fuel cells and fueling solutions company, and has partnered with the company to explore the Asian hydrogen market. SK E&S also invested last year $1 billion in Key Capture Energy and REV Renewables, leading energy solution providers in the U.S.
SK Inc., SK’s investment arm, is making investments in a broad range of U.S. businesses in the bio sector, eco-friendly energy sector and alternative food sector. SK Inc. invested $350 million in the Center for Breakthrough Medicines, a leader in cell gene therapy based in the Philadelphia area. SK Inc. also is investing in Monolith Materials in Nebraska, a clean hydrogen producer, and Perfect Day in California, which produces alternative proteins.
SK hynix, the world's second-largest semiconductor memory manufacturer, acquired Intel's NAND memory division for $9 billion and created a new U.S. subsidiary, Solidigm. SK hynix believes that by expanding solid state drives (SSD), a NAND storage device, to replace hard disk drives (HDD), a more traditional storage device, greenhouse gas emissions can be reduced by 93%. Moreover, SK hynix plans to invest $1 billion to build an R&D center in California’s Silicon Valley.
SK Siltron CSS Part of Focus on Sustainability
Like these other investments, SK Siltron CSS in Michigan is supporting a new global supply chain to advance environmentally friendly industries. The SK Siltron CSS wafers are made from silicon carbide (SiC), a material that’s more efficient at handling high powers and dissipating heat than silicon wafers. The SK Siltron CSS wafers are used by other companies upstream to make microchips for power electronics – the parts of the EV that help transfer electricity from the battery to the motor.
When used in EV system components, SiC can allow a more efficient transfer of electricity and weight saving, resulting in increased driving range of an EV by 5% to 10%. A single 6-inch diameter wafer from SK Siltron CSS can be used by its customers to make about 450 power chips, or enough chips for the power systems of 6-8 EVs.
“The wafers made at our SK Siltron CSS sites in Michigan are designed to help improve the energy efficiency of EVs, enabling EV drivers to go further on every charge and charge faster at each stop,” said Jianwei Dong, CEO of SK Siltron CSS. “Ultimately, we believe this can help make EVs more attractive to consumers and more practical for their daily driving needs.”