Electric cars: Silicon carbide: Chip companies are investing billions in the material of the future
Munich, Stuttgart Twelve months of waiting time: Anyone who orders semiconductors made from the material of the future silicon carbide from STMicroelectronics today needs a lot of patience. The energy-saving chips from the ST plants in Catania or Singapore will not arrive before spring 2023. The factories are fully booked well into next year.
The world’s largest manufacturer of the coveted components for electric cars is therefore spending billions to expand its capacities. By 2024, emissions will more than double, says ST manager Filippo Di Giovanni.
US competitor and SiC supplier Wolfspeed is opening a factory in America this spring that will cost a billion dollars.
And as the only automotive supplier in the world, Bosch is expanding its SiC series production in Reutlingen, which has been running since the end of 2021. The market for these semiconductors is growing and has not yet fully reached its potential, Bosch CEO Stefan Hartung told Handelsblatt: “We will benefit massively from this – Bosch will also be at the forefront here.”
SiC is strategically extremely important for the world’s largest automotive supplier group. “This is a key technology for the future of mobility and that’s why we rely on it,” says Hartung. “Silicon carbide power semiconductors are particularly efficient and, as a result, enable greater ranges in electric vehicles, for example.”
This year alone, Bosch is investing 400 million euros in the expansion of the entire semiconductor production. A significant portion of this goes into SiC production. However, Bosch does not name the exact proportion.
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Market researchers at Yole are forecasting sales of $6.3 billion for SiC chips in 2027, around six times as much as last year. This corresponds to an annual increase of a good third. This growth makes SiC a highly attractive niche in the $600+ billion semiconductor market.
Yole estimates that Infineon’s SiC sales more than doubled last year. At ST and Wolfspeed, revenues have each skyrocketed by more than half. Overall, the SiC market grew by 57 percent to just under $1.1 billion. The most important customer is the automotive industry, above all the electric car pioneer Tesla.
ST speaks of more than 90 projects with customers that are currently in progress. More than half of them in Germany. However, the lead times are considerable, in the automotive industry it takes between three and five years from the first contact to series production. That means: The best times for SiC are yet to come – from the middle of the decade.
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From 2024, ST therefore wants to produce on 200 millimeter SiC discs. “This is an important technological leap that brings enormous cost advantages,” says Peter Fintl, chip expert at the consulting firm Capgemini. Up until now, so-called wafers with a diameter of 150 millimeters have been common.
Last summer ST made the first prototype with 200 millimeters. This means that emissions will increase sharply because there is almost twice as much space on the larger panes. For conventional silicon chips, 300 millimeter wafers have been standard for almost 20 years. However, SiC is much more difficult to process.
ST claims a market share of more than 50 percent. The group’s goal is to increase SiC sales to one billion dollars by 2024, which is more than twice as much as last year. “The market will attract a lot of competition,” says ST manager Di Giovanni. Nevertheless, the group is trying to maintain a double-digit market share over the long term.
With the Swedish company Norstel, ST bought its own supplier for SiC in 2019. The Scandinavians are expected to produce 40 percent of the SiC discs that ST needs in two years.
Infineon failed to purchase a supplier
Infineon also wanted to take over a SiC producer in 2017, the US group Wolfspeed. The American authorities prohibited the deal with reference to national security. Wolfspeed is both a competitor for SiC chips and a supplier of the material. It is similar at Rohm: At the subsidiary SiCrystal in Nuremberg, the Japanese manufacture SiC and sell it to customers such as ST or Infineon. At the same time, Rohm offers SiC semiconductors.
The combination of silicon and carbon is energy efficient and takes up little space. “Silicon carbide is a very light and also the hardest ceramic material with very good thermal conductivity and very good resistance,” according to the electronics industry association ZVEI. SiC allows vehicle manufacturers to either use smaller batteries or offer a longer range.
Silicon carbide also enables a shorter charging time. The composite thus helps to solve the fundamental problems of electromobility. It’s worth using, even though the material costs at least twice as much as conventional silicon. “Efficiency and the range that can be achieved as a result counts for electric cars, which is why SiC is so important,” explains consultant Fintl.
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Tesla has been using SiC for its inverters, among other things, since 2017. These are electronic control units that direct the energy from the battery to the motor in an electric car. The US electric car pioneer sources its SiC-based power semiconductors directly from ST.
Germany’s largest chip manufacturer, Infineon, wants to increase its sales of SiC chips to one billion dollars by 2025. But it will not stop there: When the new factory in Malaysia is finished, it will be able to produce semiconductors for two billion euros a year.
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