(MENAFN- Asia Times)
The worldwide expansion of silicon carbide power Semiconductor production capacity continues despite weak demand for the electric vehicles and industrial machinery in which those devices are used.
Silicon carbide wafer and discrete semiconductor makers from the US, Japan, Europe, South Korea and China are upgrading from 6-inch (150mm) to 8-inch (200mm) diameter wafers, increasing their productivity in preparation for the next up-cycle and insulating their business from Politically motivated supply chain disruption.
Silicon carbide (SiC) is rapidly replacing ordinary silicon (Si) as the preferred substrate for power semiconductors. Its advantages include:
resistance to higher voltages,
tolerance of a wider range of temperatures and vibration and
longer device lifetimes.
Power semiconductors control the electricity used to run motors, power systems, lighting and other appliances by converting electric power from AC to DC and adjusting voltages to appropriate levels.
Compared with silicon, SiC-based devices are more energy efficient and reliable. They are key to the performance of not only electric vehicles and industrial machinery but also battery charging and storage, solar and wind power and data centers.
Wolfspeed, the US company that pioneered the use of SiC and remains the world's largest producer of SiC wafers, has recently acquired $2.5 billion in funding to upgrade and expand its 8-inch wafer manufacturing capabilities in North Carolina and New York.
The funding includes
a $750 million award under the CHIPS Act;
$750 million in loans from institutional investors Apollo, the Baupost Group, Fidelity Management & Research Company and the Capital Group; and
$1.0 billion in anticipated Section 48D advanced manufacturing tax credits from the US Internal Revenue Service.
In announcing the funding, Wolfspeed noted that silicon carbide has been identified by the US Department of Energy as“one of 17 'critical materials' with a high risk of supply disruption that are integral to clean energy technologies.” The US Commerce Department has described the material as important to national security.
The funds should enable Wolfspeed to complete the world's first and largest 8-inch SiC manufacturing complex in Mohawk Valley, New York. This should improve the company's profit structure and support its market share, which, in the estimation of French market research and consulting firm Yole, dropped from close to 50% in 2021 to about 35% in 2023 due to the rise of Chinese SiC wafer manufacturers.
The new financing is also required to pay for the expensive transition from 6-inch to 8-inch wafers, which has put Wolfspeed into the red.
Wolfspeed also faces rising competition from the Japanese, who are also upgrading to 8-inch wafers while losing money. Rohm, the largest Japanese maker of SiC wafers and devices, dropped into the red in the three months to September – its first loss in a dozen years.
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