Silicon carbide (SiC) semiconductors have been manufactured for decades but only recently has the technology become in high demand as the automotive market accelerates the largest transition in its history to electrification.
Automotive OEMs are planning to switch to battery electrified models as the primary cars sold in the next 10 to 15 years due to government mandates for climate change and maybe even more importantly consumer demand, which is expanding exponentially.
This move to electrification is increasingly defining the overall market demand for automotive power semiconductors. Originally, the automotive power market was dominated by silicon IGBT and MOSFETs with the opportunity for wide bandgap semiconductors such as SiC and gallium nitride (GaN) limited to early adopters such as Tesla.
But with the shift currently to battery EVs and ongoing transition to a fleet of electrification by automotive OEMs, SiC demand is skyrocketing.
Source: TechInsights
Expanding revenues
According to market research firm TechInsights, the overall SiC market from EV production will reach revenues of $9.6 billion by 2030, managing a compound annual growth rate of a whopping 37% through 2027.
“We do not however expect other power electronic semiconductor demand to disappear with Si-based IGBTs, MOSFETs and diodes still accounting for 50% of the overall market demand at that time,” said Asif Anwar, executive director of automotive at TechInsights.
The automotive power market — power MOSFETs, IGBT and SiC semiconductors — is set to reach revenues of $26.6 billion by 2030. This is nearly double the revenue it will generate this year at $12.6 billion. In the next five-year period, the power chip market for automotive is forecast to manage a compound annual growth rate (CAGR) of 16.0%.
Use in EVs
That said, the use of SiC will depend on the type of EV that is being manufactured.
For mild hybrids, the segment will continue to lean on the use of silicon MOSFETs, however, there may be some use of GaN technology if the price point can be reduced to match current MOSFETs. In full hybrids and plug-in hybrids, wide bandgap technologies like SiC and GaN will not be ideal due to the cost effectiveness of mainstream silicon IGBT and MOSFET technologies, TechInsights said.
Full battery EVs will be the main driver for SiC chips in the main inverter and this will be joined by increasing use across power electronics systems like DC-DC converters and on-board chargers. While the SiC chips are much more expensive than other technologies, the advantages the technologies afford in a reduction in size and weight as well as system performance and battery life will help lead to greater penetration of EVs in the long run, TechInsights said.
Demand expected
And companies are already planning and banking on this growth to be a huge revenue generator. Earlier this month, ST Microelectronics, which accounts of about 50% of the overall automotive SiC market, said it will build a 200 mm SiC manufacturing joint venture with Sanan Optoelectronics in Chongqing, China.
OnSemi has been on a spending and deal spree signing a 10-year SiC agreement with automotive electric equipment maker Vitesco Technologies. Additionally, the company pledged to expand its SiC production at one of its fabs with a new $2 billion investment after making a different supply deal with EV charger maker Kempower.
X-Fab said it would expand its Lubbock, Texas, chip fab by $200 million for more SiC devices and Bosch acquired U.S. semiconductor foundry TSI Semiconductors to expand its own portfolio of SiC chips through the end of 2030. Bosch gave the anticipated automotive electrification transition as the reason for the acquisition.
In February, Wolfspeed Inc. said it would build its first semiconductor fab in Europe, a 200 mm wafer factory for SiC devices. The fab will be built in Saarland, Germany, and is part of Wolfspeed’s broader $6.5 billion capacity expansion effort that will also see the company expand its other SiC operations in the U.S.
Other companies like Texas Instruments and Skyworks are also accelerating plans to develop SiC semiconductors primarily for the automotive market, but will play in other hot markets as well.
