Benefiting from Tesla‘s silicon carbide reduction, IGBT has become a "hot spot" in the industry, and labor prices have risen due to shortage

Source: Science Innovation Board Daily Author: Qiu Siyu

    According to a report by Taiwan Electronic Times today, IGBT is in a major shortage, which will be difficult to solve at least until the middle of 2024. Previously, there was also news that the OEM prices for some manufacturers‘ IGBT production lines increased by 10%.

    According to industry insiders in the field of wafer foundry, due to strong demand for automotive and industrial applications, and customers willing to accept long-term contracts and price increases, TSMC, Liandian, and other foundries have adjusted their capacity configurations, and the size of IGBT customers and orders will significantly increase by the end of 2023.

    There are four main reasons for the shortage and price increase of IGBT: First, there is strong demand, and the amount of IGBT required for automotive and industrial applications has increased significantly; Second, insufficient supply and slow capacity expansion; Third, customer certification requires time; Fourth, Tesla slashed the amount of silicon carbide by 75%, with IGBT as a potential alternative.

    In terms of demand, previous market news also pointed out that there was a shortage of IGBT due to strong demand in the electric vehicle and photovoltaic fields. Some industry executives have bluntly stated that price increases to grab goods are no longer new, not a matter of how high the price is, but simply that they cannot be purchased. This wave of shortage will continue for some time.

    The recent research results of Toubao Research Institute indicate that IGBT is driven by the demand for new energy vehicles, charging piles, photovoltaic, and rail transit. By 2025, the new scale of IGBT for new energy vehicles in China is expected to exceed 20 billion yuan, with a compound growth rate of nearly 34% from 2021-2025; Charging piles will add nearly 24 billion yuan and CAGR will also be nearly 34%, with the fastest growth rate of both. In terms of photovoltaic, it is expected that by 2030, the new market size of photovoltaic IGBT in China is expected to exceed 6.6 billion yuan, with a compound growth rate of 8.69%.

    On the supply side, IDM manufacturers have been slow to expand production. Infineon‘s new factory in Germany needs to wait until 2026 to officially mass produce, and Ansemy‘s production capacity has been fully sold out in 2023. Supply chain insiders have pointed out that in the second half of 2022, the global IDM IGBT has basically finalized the supply for the whole year of 2023. The price increase scheme operates in two ways: first, operate according to the contract content, and increase the price at the agreed time point; Second, operate according to the spot market. Even if there is a contract, the supply is still insufficient, and the situation of non contract spot market looting continues. Although the domestic market for new energy vehicles has cooled, the supply of IGBT for vehicles still exceeds demand.

    IGBT customers and order sizes have significantly increased, but it still takes time for downstream wafer foundries to adjust their capacity. Previously, wafer foundries‘ capacity was mainly concentrated on consumer electronics products with large and stable order sizes. Although the capacity utilization rate of the consumer electronics production line is low, it still requires time to adjust if the production line is to be transferred to customers such as IGBT, and the two production lines cannot be shared immediately. Therefore, in the short term, IGBT will still be in short supply.

    In addition, it is worth noting that in the context of Tesla abandoning 75% silicon carbide, institutions such as Huatai Securities have analyzed and pointed out that the silicon carbide+IGBT hybrid module scheme may reduce the cost of electric drive systems using silicon carbide, which is one of the potential options. This scheme replaces some silicon carbide devices in the original TPAK package with IGBT and packages them into hybrid modules. Overseas laboratories have successfully developed a FREEDM-PAIR hybrid module and confirmed its feasibility. If automotive companies adopt a hybrid module scheme of SiC MOSFET and IGBT, it can significantly reduce costs.

    Domestically, the organization recommends paying attention to the manufacturers that layout IGBT, including Star Semiconductor, Silan Microelectronics, Time Electric, China Resources Microelectronics, New Jieneng, Yangjie Technology, Hongwei Technology, Huamicroelectronics, Dongwei Semiconductor, Perry Co., Ltd.