SiC Wafer Market

Market Overview

The Total Addressable Market (TAM) for SiC wafer was valued at USD 818.98 million in 2022. It is projected to reach USD 2949.42 million by 2031, growing at a CAGR of 15.30% during the forecast period (2023-2031). 

Single silicon carbide crystal layers several micrometers thick are grown epitaxially on a polished wafer to create silicon carbide epitaxial wafers. Accurate management of layer thickness, doping, and defect density is essential for a semiconductor fabrication facility to produce high-yield power devices. Silicon carbide devices are widely employed in optoelectronics that requires high operating temperatures, resistance to radiation, or operation at low wavelengths. Research facilities and small and large semiconductor device manufacturing enterprises have extensively employed SiC wafers. Significant drivers of the worldwide silicon carbide epitaxial wafer market include the rise in creative end-user applications and the rising need for high-performance semiconductors.

Market Dynamics

Market Drivers

Increasing Market Share of Electric Vehicles and the Trend towards High-voltage EV Architectures

According to IEA data, there were more than three times as many publicly accessible charging stations in the United States in 2020 as in 2015, when there were fewer than 32,000. IEA predicted that, depending on governmental measures, the number would increase significantly by the decade's end, from 800,000 to 1.7 million. The demand for electric vehicles (EVs) with quicker charging times and greater ranges has accelerated the automotive industry's move toward high-voltage EV platforms. Important manufacturers have released models with 800 V charging architectures, including the Audi Q6 e-Tron, Porsche Taycan, and Hyundai Ioniq 5.

The demand for silicon carbide (SiC) wafers in the worldwide automotive market is anticipated to rise due to the increasing EV penetration rate and the move toward high-voltage 800 V EV layouts. Porsche's high-end Taycan EV, the first vehicle from a major automaker with an 800 V battery, was delivered in more than 20,000 units. Delphi Technologies, a supplier, stated in September 2020 that it would provide 800 V inverters to a luxury electric vehicle maker. The supply agreement is anticipated to go into effect throughout the manufacturer's EV lineup in 2024.

Market Restraint

Limiting Constraints, such as Scalability, Heat Dissipation, Packaging-related Pressure on the Dieand Substrate Supply

More dies are available per unit area on a giant wafer. In semiconductor production facilities and OSATs (outsourced semiconductor assembly and test), there is additional space to fabricate more dice, allowing them to produce and test or assemble more dice in a given period. As a result, the rate at which new goods can be constructed or put together accelerates. Growing wafer size has some favorable effects on the supply chain as well. On two 150 mm wafer lines, STMicroelectronics has produced SiC goods in Catania, Italy, and Ang Mo Kio, Singapore. STMicroelectronics' ongoing plan to construct a new SiC substrate facility and source more than 40% of its SiC substrates internally by 2024 includes the shift to 200 mm SiC volume production. SiC wafer has been a promising material for use in electric vehicles and the infrastructure for charging them, as well as in producing and distributing clean electricity. Considering the expanding end-user applications, overcoming the obstacles may present the market with enormous development prospects.

Market Opportunities

Increasing Demand for SiC Wafers in Power Electronics Switches and LED Lighting Devices

Specific SiC wafers and substrates are created in the manufacturing process, followed by fab processing to produce SiC-based power semiconductors. In power electronics, where the components convert and regulate the flow of electricity in systems, many SiC-based power semiconductors are employed. In the worldwide electrical infrastructure, power electronics are crucial. The technique is utilized in computers, renewable energy (solar, wind), industrial (motor drives), and transportation (cars, trains) (power supplies).

Another use for SiC is the production of LEDs. Alternating and direct currents are transformed or converted by power electronics. The market transition to SiC-based power electronics, a wide-bandgap semiconductor that enables power electronics to be smaller, more efficient, and with a lower total system-level cost of ownership than advanced silicon-based devices, is also being driven by the electrification of the transportation infrastructure. SiC semiconductors are likewise becoming more and more popular because of their benefits. Businesses have focused on producing SiC power semiconductors to fulfill the growing demand. Bosch announced the start of SiC power semiconductor volume production.

Regional Analysis

The global SiC wafer market is bifurcated into four regions: North America, Europe, Asia-Pacific, and LAMEA. 

North America Dominates the Global Market

North America is the most significant revenue contributor and is expected to grow at a CAGR of 15.7% during the forecast period. North America is at the forefront of new technology adoption in semiconductor manufacturing, design, and research. Strong correlations exist between the expansion of end-user industries like automotive, energy, IT and telecommunications, military and aerospace, and consumer electronics and the growth of the SiC wafer industry in North America. The energy sector could transform thanks to silicon carbide technology, encouraging local businesses to invest in new product development. Several groups, including governmental bodies, are working in this area on advanced manufacturing research to produce SiC wafers. For instance, to enhance the materials and procedures used to produce silicon carbide (SiC) wafers, the National Renewable Energy Laboratory's (NREL) advanced manufacturing researchers collaborated with businesses and academics. Players concentrate on product innovation and developing new goods because GaN on Silicon Carbide is an attractive technology. Even though Canada might be considered a country without a sizable electronics and semiconductor base, the region has a sizable market for products that contain or use semiconductors.

Europe is expected to grow at a CAGR of 15.5%during the forecast period. The European continent is a significant driver and adopter of contemporary technology and is home to some vital tech centers worldwide. The market is expanding due to the rising adoption of advanced technologies and semiconductors across numerous sectors. The market in the region is further strengthened since critical components and wafers are provided to regional players by foreign companies. One of the major car markets, Europe, is responsible for a sizeable portion of the world's automobile production units. The ACEA estimates that more than 19.2 million vehicles, vans, lorries, and buses are produced in the area annually. Around 309 vehicle assembly and production facilities are run by automakers across 27 nations in the region.

Additionally, the sector generates a trade surplus of roughly USD 84.4 billion in the EU zone. The market in the region is further strengthened by the fact that foreign companies are supplying critical components and wafers to regional companies. For instance, the Japanese wafer producer Showa Denko KK and the German semiconductor company Infineon Technologies AG signed a supply agreement for a wide variety of silicon carbide materials (SiC), including epitaxy. As a result, Infineon Technologies AG was able to meet the rising demand for SiC-based products with more base material. This agreement has a two-year term with a possible extension.

Asia-Pacific controls the worldwide semiconductor market, which is also supported by government policies, making it a significant region in the global SiC wafer market. Furthermore, Taiwan, China, Japan, and South Korea collectively account for a sizeable portion of the worldwide semiconductor market. At the same time, other countries like Thailand, Vietnam, Singapore, and Malaysia also considerably contribute to the region's market domination. Players with a strong presence in the area include SK Siltron, a South Korean semiconductor wafer maker and one of the top five global wafer producers, with KRW 1.542 trillion yearly sales.

Additionally, the region is a sizable market for renewable energy, particularly solar and wind energy. The adoption of solar infrastructure in the area, particularly in Southeast Asia, is also greatly aided by the national governments of those countries, fostering market expansion there. For instance, at the end of the third quarter of 2021, India's installed renewable energy capacity (including hydro projects) reached 147.8 GW or approximately 38% of the total power mix. By 2030, the nation wants to have 450 GW of built renewable energy capacity; more than 60% of that capacity, or around 280 GW, is expected to come from solar.

Compound semiconductors are becoming in demand in Latin America. The growing need in the region's automotive industry has spurred the growth of semiconductor demand in the area. Mexico's growing auto manufacturing facilities can be attributed to its industrial sector. In the middle part of Mexico, new facilities for Nissan, Honda, and Mazda have opened. These businesses are anticipated to produce electric vehicles, which could expand the Mexican semiconductor market. The production of electric vehicles is a developing industry in Mexico, driving demand for semiconductors. Global automakers are investing more and more in Mexico to establish factories to produce electric vehicles.

For instance, according to Porsche Mexico's network development and E-performance manager, Porsche is involved in constructing an electrical infrastructure system and manufacturing electric vehicles in Mexico. The corporation intends to spend more than 6 billion euros by 2022 on electrical infrastructure and electric vehicles. Additionally, General Motors declared that it would spend more than $1 billion in its Ramos Arizpe, Mexico, manufacturing complex.

Segmental Analysis

The global SiC wafer market is segmented by wafer size, application, and end-user industry.

Based on wafer size, the global SiC wafer market is bifurcated into 2, 3, 4-inch, 6-inch, 8, and 12-inch. 

The 2, 3, and 4-inch segment is the highest contributor to the market and is estimated to grow at a CAGR of 14.2% during the forecast period. SiC wafers of smaller sizes are more expensive for manufacturers to add since it is more difficult to add more semiconductors to them. New material for achieving a low-carbon society is a SiC wafer. Unlike silicon wafers, semiconductor devices such as transistors, diodes, and other devices are made using silicon wafers. SiC reduces power loss to 50% when employed in multiple electronic gadgets. It is appropriate for high-voltage, high-temperature uses in automotive (EV, HEV, etc.), photovoltaic power generation, and other applications in power electronics because it has an outstanding heat resistance and high-voltage qualities. The SiC substrate is currently 6 inches, and 8 inches are being developed. However, 4-inch wafers continue to be widely adopted. Cost reduction has not advanced significantly, and replacing equipment requires further capital investments. Additionally, the 6-inch now has a substantial production efficiency advantage.

The development of 150mm/ 6 inches SiC wafers has been a critical factor in the widespread market adoption of this technology. This has enabled the utilization of decommissioned 150mm silicon production lines, which can be adapted to make silicon carbide wafers meet the required criteria and the realization of manufacturing economies of scale. To improve the market adoption of SiC for use in bipolar devices, more significant, higher voltage-rated devices were developed to minimize prolonged crystal defects and regulate surface shape and flatness, two crucial components required by lithography processes. The low micropipe defect density was successfully managed by fine-tuning seed selection and development procedures. As an illustration, Dow Corning resolved these difficulties and provided 150 mm SiC substrates with warp, bow, and thickness variation metrics that complied with industry standards for handling in the processing lines. To solve the current and forthcoming electronics industry problems, Dow Corning manufactures and sells 4H-SiC 150 mm wafers.

Based on application, the global SiC wafer market is bifurcated into power, radio frequency (RF), and other applications. 

The power segment owns the highest market share and is estimated to grow at a CAGR of 15.7% during the forecast period. One of the essential parts, power electronic switches, is made with silicon carbide wafers. These switches carry large currents, which makes it necessary to make them out of sturdy materials like SiC. This is crucial to employ wafers with good thermal conductivity and low electrical resistance. Additionally, it enables a decrease in the size and weight of these switches. Due to the high market demand and ongoing trend for SiC wafers, businesses have improved the SiC production process. The substrate supply chain may be modernized to swiftly meet the rising demand for high-power solutions.

Further, performance improvement is impossible due to silicon's physical-electrical characteristics, and undertaking research would be prohibitively expensive and unprofitable in terms of investment costs. Interest in silicon carbide wafers has increased recently because this individual semiconductor can increase power handling capability, and its behavior is achieved by combining higher power density and better efficiency. Many presents and upcoming commercial applications that use SiC technology, such as switching power supplies, inverters for solar and wind energy generation, industrial motor drives, HEV and EV vehicles, and smart-grid power switching, contribute to the growth of the SiC wafer market globally.

SiC devices are increasingly being used in cellular base stations and radio-frequency operations. Favorable government policies that promote renewable energy sources for power generation are also predicted to advance the market. Devices using SiC substrates in RF power applications generate revenues of up to USD 330 million. Sales are soaring as a result of increased deployments in numerous fields. Armies, governments, and private firms are all vying for the most advanced technologies. However, many RF equipment, such as those used in homeland security and defense, have exacting specifications frequently unattainable by the commercial sector. This prerequisite emphasizes the significance of R&D capability. The radio frequency (RF) industry has several potential applications, including 5G and smartphone hardware, the military, and the car industry. The demand for products that enable direct wireless communication and the rising popularity of consumer electronics have sped up the development of the RF technology sector. These are a few of the elements promoting the expansion of the SiC wafer market.

Based on end-user industry, the global SiC wafer market is bifurcated into telecom and communications, electric vehicles (EVs), photovoltaic/power supply/energy storage, industrial (ups and motor drives, etc.), and other end-user industries. 

The telecom and communications segment is the highest contributor to the market and is estimated to grow at a CAGR of 15.7% during the forecast period. Technology is developing quickly. SiC wafers are likely in high demand in the electronics sector to meet this technical necessity. To stay ahead of the curve, companies in the semiconductor industry must develop and sustain innovative technologies. Power semiconductors are in high demand as telecom companies rush to launch superfast 5G networks. Silicon carbide (SiC) wafers are exceedingly durable, resistant to heat, and can bear high voltages. Due to their properties, wafers are frequently utilized to build power semiconductors for 5G networks and electric vehicles, where energy efficiency is critical. The need for power semiconductors is gradually rising as telecom companies create 5G networks with breakneck speeds. SiC wafers have a high degree of hardness, are heat-resistant, and can withstand high voltages. These characteristics make wafers a popular manufacturing tool for power semiconductors for 5G networks and electric cars, where energy efficiency is crucial.

To achieve carbon neutrality and net-zero emissions, several governments have set a date for the phase-out of gasoline-powered vehicles, incentivizing automakers to hasten the switch to electric vehicles. A cutting-edge material called silicon carbide (SiC) has been employed in place of silicon (Si) in several applications. Additionally, attempts were made to decrease the weight and price of the entire vehicle while increasing the efficiency and range of electric vehicles (EVs). With the increase in the control electronics' power density came the concept of employing SiC for EVs. It is estimated that SiC can extend the EV battery range by 20% compared to Si and that SiC chargers can reduce charging time by 30% due to their increased energy efficiency. As the need for electric vehicles and quick charging stations increases, SiC wafer requirements could increase. Fast-charging stations employ SiC. By 2024, 3.3 million units are anticipated to be deployed globally; silicon carbide may represent a sizeable portion of this market. Depending on the charger's capabilities, different chargers contain different amounts of SiC.

Recent Developments

• March 2022- II-VI Incorporated accelerated investment in Silicon Carbide Substrate and Epitaxial Wafer Manufacturing with Large-Scale Factory Expansions in Pennsylvania and Sweden.
• April 2022- Wolfspeedopened the World's Largest 200mm Silicon Carbide Fab, Enabling highly anticipated device production.