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Cree to build $1B semiconductor plant in Marcy, with state help

By Eric Reinhardt

Date:

Plans to create more than 600 jobs                                                    

Howard Zemsky, chairman of the board for Empire State Development Corp., addresses the gathering as the state announces a public-private partnership between New York and Cree, Inc. of North Carolina to spend about $1 billion over six years to construct and equip a new, 200mm silicon-carbide wafer fabrication facility in Marcy, near Utica. (PHOTO CREDIT: MIKE GROLL/OFFICE OF GOV. ANDREW CUOMO / CUOMO FLICKR)

MARCY — A North Carolina company expects to create more than 600 full-time, “highly-skilled” technician and engineering positions at the Marcy Nanocenter on the SUNY Polytechnic Institute campus near Utica.

Cree, Inc. (NASDAQ: CREE) on Sept. 23 announced plans to spend $1 billion to build the “world’s largest silicon carbide fabrication facility” in Marcy.

Cree — a firm that manufactures power and radio frequency (RF) semiconductors, lighting-class LEDs and lighting products — expects to call its new wafer-fabrication facility, “North Fab.” 

It will be “complemented by its mega materials factory expansion currently underway at its Durham headquarters.”

The project is part of the firm’s effort to “establish a silicon carbide corridor on the East Coast of the United States.”

Gov. Andrew Cuomo discussed the project during a Sept. 23 visit to SUNY Polytechnic Institute.

As part of the agreement, Cree will be investing about $1 billion in construction, equipment, and other related costs for the Marcy project. New York State will provide a $500 million grant from Empire State Development and Cree will be eligible for additional local incentives and abatements as well as equipment and tooling from SUNY. As a result, the company expects to realize a net capital savings of about $280 million on its previously announced $1 billion capacity expansion through 2024, per a Cree news release. 

The new fabrication facility — part of a previously announced project to “dramatically increase” capacity for its Wolfspeed silicon carbide and GaN (gallium nitride) business — will be a “bigger, highly-automated factory with greater output capability,” Cree said. Through an agreement with the office of Gov. Andrew Cuomo and other state and local agencies and entities, the decision to build in New York will allow for both “continued future expansion of capacity and significant net cost savings for Cree.”

In addition, it will provide 25 percent increased output compared to the previously planned facility. Ramping in 2022, the size of the new facility will be up to 480,000 square feet upon completion, about one-fourth of which will be clean-room space, providing future expansion capacity as needed. 

Cree contends the expansions will “further improve its competitive position in the marketplace and accelerate silicon carbide adoption across an array of high-growth industries,” per its release.

With the agreement, Cree also contends it will “continue to drive the transition” from silicon to silicon-carbide technology to meet the “increasing demand” for the company’s Wolfspeed technology that supports the growing electric vehicle (EV), 4G/5G mobile, and industrial markets.

In reaction, U.S. Representative Anthony Brindisi (D–Utica) issued a statement praising the expansion.

“The big winners today are the people that call our area home. Cree’s decision to expand its manufacturing facility in Marcy next to the SUNY Poly campus will ensure we continue to be at the forefront of high-tech manufacturing and provide more good paying jobs for our residents,” said Brindisi.

Construction and leasing

During construction of the Marcy semiconductor plant, which Cree has agreed to perform subject to prevailing-wage requirements, the company will also lease space on the SUNY Poly campus in Albany, where Cree will utilize equipment purchased as part of the New York Power Electronics Manufacturing Consortium (PEMC), the office of Gov. Andrew Cuomo said in a Sept. 23 news release.

With that process, Cree will transition from the current process of producing devices on 150mm silicon-carbide wafers to a new process of producing devices on 200mm silicon-carbide wafers, which is expected to be the first example of producing devices on 200 mm silicon-carbide wafers in the world. 

As the fab ramps, Cree will transfer the PEMC equipment and its 200mm process to the SUNY Poly Marcy campus location. 

Mohawk Valley EDGE will sublease the parcel to Cree under a 49-year lease. Construction of the fab will be led by Cree and monitored by Empire State Development, Mohawk Valley EDGE, and the New York Center for Research, Economic Advancement, Technology, Engineering and Science (NY CREATES). 

In total, the new facilities in Marcy are expected to cover about 500,000 square feet, including up to 135,000 square feet of cleanroom space and other support facilities.

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