Exclusive: Wolfspeed CEO explains $5 billion Chatham County expansion
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Wolfspeed, the Durham-based chip maker formerly known as Cree, has picked Chatham County for a $4.8 billion materials plant.
- The plant is expected to create at least 1,800 jobs that pay an average of $77,753 per year.
Why it matters: The expansion, unveiled Friday after months of behind-the-scenes negotiations, is yet another manufacturing win for central North Carolina to come in exchange for large-scale tax incentives.
- The state and local governments will provide about $775 million in incentives if Wolfspeed meets hiring and investment goals.
Driving the news: The state’s Commerce Department approved a Job Development Investment Grant Friday morning worth $76 million to Wolfspeed if it hires 1,800 workers by 2030.
- The company could also receive more than $600 million from Chatham County and Siler City.
Wolfspeed CEO Gregg Lowe told Axios in an exclusive interview this week that his company had been on the search for a new materials facility for about a year due to rising demand for its silicon carbide chips, which are more energy efficient than traditional silicon and have become popular with electric car makers.
- “EV adoption is happening earlier and faster than anyone anticipated,” Lowe said. Wolfspeed’s customers include GM and Lucid Motors.
Lowe said he believes Wolfspeed’s new facility could also be eligible for incentives under the recently signed Chips and Science Act.
The big picture: The Wolfspeed announcement comes on the heels of recent news that Vietnamese car maker VinFast plans to make electric vehicles in Chatham County, and that Toyota is building a battery plant in nearby Randolph County — both employing several thousand workers.
- These facilities promise to bring tremendous growth to a mostly rural part of the Piedmont region over the next decade, stretching the Triangle’s suburbs farther to the South.
Flashback: Axios reported earlier this year that Wolfspeed was considering Chatham County for an expansion, after the state budget set aside $112.5 million as a potential incentive for a chip manufacturing project in Chatham County. The money would be used to ready the land for the needs of the facility, which will require large amounts of energy and water.
- To qualify for the budget’s incentive, Wolfspeed must invest at least $4.8 billion in the county and create those 1,800 jobs.
Zoom in: In Chatham County, Wolfspeed will build a plant where it will grow the crystalline material that goes into its silicon carbide chips. It has a smaller location in Durham that already does this, which will be complemented by the Chatham plant.
- The materials created there will be sent to the company’s production facility in New York for final manufacturing.
- “We produce 60% of the world's silicon carbide out of our North Carolina facilities in Durham,” Lowe said. “The Chatham site will be substantially larger than that. Think of it as more than 10x the size.”
Lowe said, beyond the financial incentives, North Carolina’s workforce and Wolfspeed’s existing facilities here made it the right choice. He noted the company received strong offers from several other states, including New York.
- Wolfspeed has a partnership with North Carolina Agricultural and Technical State University’s engineering school in Greensboro.
- Lowe said Wolfspeed’s high wages and focus on making technology that fuels the transition away from gas engines help it find talent. “For the folks coming out of college right now these are important topics,” he said.
What’s next: Phase one of construction is expected to be complete by 2024. The second phase, which could push the entire facility to one million square feet, will be completed in 2030.