Silicon carbide EV chips poised for 'breakneck' growth

Silicon carbide, an ancient material discovered by accident in 1891 by an inventor hoping to make synthetic diamonds, is fast becoming critical for electric vehicles, with the world’s biggest suppliers investing billions to ensure they can fill an anticipated wave of orders for EV inverters from automakers.

Chips made with silicon carbide, or SiC -- one of the world's hardest materials after diamonds -- are at the heart of a new generation of inverters, the critical link between the DC current from batteries and the AC current used by electric motors.   

Silicon carbide chips for inverters offer a number of benefits over silicon-based ones.

• They are much more stable at higher voltages (800 volts and above), which allows faster charging.
• They use less material, which saves space and weight.
• They can operate at higher temperatures, reducing the need for costly thermal management.
• They have up to 70 percent less switching or conversion losses, as well as faster switching frequencies, potentially extending range by about 5 to 6 percent, industry experts say.

“With silicon carbide compared to silicon, you can improve your efficiency by a significant factor,” BorgWarner CEO Frederic Lissalde told Automotive News Europe. BorgWarner has invested $500 million in the U.S. company Wolfspeed in a deal that will allow the supplier to buy up to $650 million worth of silicon carbide chips annually.

“Owing to all the advantages of the technology, the market demand for silicon carbide-based devices is going to accelerate at a breakneck speed in the years to come,” Claudio Vittori of S&P Global Mobility said in an interview. This is “worrisome from a demand-supply point of view,” he added. 

According to S&P’s figures, silicon carbide-based inverters will be dominant by 2034, with volume growing at an annual pace of 32 percent. Vittori said they will appear first on premium and luxury cars with 800-volt electrical systems, then trickle down to mainstream models with lower-voltage systems.

In addition to inverters, SiC chips will also be used in onboard chargers and DC-to-DC converters, he added.

ZF is going even further than BorgWarner, becoming a partner with Wolfspeed in a $3 billion “wafer fab” that will make 200 mm silicon carbide wafers as well as have R&D center in Germany’s Saarland region.

“Silicon carbide is the answer to some of the biggest issues of our time: energy savings and climate change,” Gregg Lowe, the CEO of Wolfspeed, said in April at the factory announcement with ZF and German officials. “With semiconductors made of silicon carbide, electric cars can go farther and charge faster, helping to accelerate the transition from gasoline automobiles to fully electric vehicles.”

Lowe told The Financial Times in December that the market for SiC power semiconductors could grow at 14 percent a year through 2030. “All of us will be running as fast as we can, trying to catch up to the demand,” he said.

ZF has also signed an agreement with STMicroelectronics for silicon carbide chips for its inverters from 2025 -- with a volume of orders in the “double-digit millions,” the companies said in April.

“With the help of silicon carbide, we can optimize the system by 5 percent, and this is quite something for electric mobility,” Otmar Scharrer, head of engineering electrified powertrain at ZF, told Automotive News Europe. 

Infineon and Stellantis signed a memorandum of understanding last September in which the German chipmaker will reserve SiC production in the second half of the decade for the automaker’s own suppliers, in a deal worth more than 1 billion euros.

Among significant recent deals, Robert Bosch in April bought TSI, a California-based silicon carbide chipmaker, and said it would invest $1.5 billion in upgrading TSI’s factory to produce SiC chips for EVs by 2026.

Vitesco on June 19 said it had signed a $1 billion-plus supply partnership with Rohm through 2030 for silicon carbide chips for its inverters, with series production due to start in 2024 for “two significant customers.”

Volkswagen Group in January signed a strategic agreement with the U.S. tech company Onsemi to provide silicon carbide modules and semiconductors for inverters for VW’s next-generation EV platforms. 

Onsemi also scored a major win at the end of May with a 10-year, $1.9 billion deal with Vitesco to supply silicon carbide-based products; as part of the agreement, Vitesco will invest $250 million to bolster Onsemi’s SiC production capabilities.

“Silicon carbide power semiconductors are at the beginning of a big surge in demand,” Vitesco CEO Andreas Wolf said in a statement. “It’s important for us to get access to the complete SiC value chain. With this investment, we have a secure supply of a key technology over the next 10 years and beyond.”

The automotive market for silicon carbide semiconductors is expected to be worth more than $4 billion annually by 2027, according to a report from Yole Group. As a percentage of the market versus silicon, silicon carbide will grow from 20 percent in 2021 to more than 50 percent by 2030, S&P estimates. 

Clearly, then, silicon carbide is the future, not only for inverters but also for uses including vehicle-to-grid energy transferral. But there are some drawbacks to the material.

Because it must be generated synthetically from silicon and carbon -- although it has been found in meteorites -- it requires extreme temperatures, up to 2,500 degrees Celsius, and pressures, and thus huge energy expenditures. And the resulting wafers can be flawed.

As with many EV innovations, Tesla was a pioneer in the use of silicon carbide chips in its vehicles, starting in 2018 in the Model 3.

Hyundai and Kia’s latest EVs on their E-GMP platform, including the Kia EV6 and Hyundai Ionic 5 and 6, also use SiC inverters, as do the Porsche Taycan and Audi E-tron GT and Lucid’s Air luxury EV.

The Lotus Eletre electric SUV from the Geely brand also has a SiC inverter, as do the Maserati GranTurismo Folgore and coming MC20 Folgore. 

With the exception of Tesla, all those cars also have 800-volt systems. 

Other automakers have recently announced agreements with top SiC chip suppliers.

• Future Mercedes-Benz EVs will use Wolfspeed SiC chips, the companies announced in January.
• BMW will use Onsemi chips.
• JLR will partner with Wolfspeed.
• Renault-Nissan will work with STMicroelectronics.
• Toyota’s associated supplier, Denso, is creating the chips itself for group EVs, including the new Lexus RZ.

The cost of silicon carbide chips -- up to five times that of silicon -- as well as the difficulty of guaranteeing sufficient, quality supply of wafers, are leading some companies to rethink how they are using the material.

In one of the more provocative statements, Tesla’s powertrain engineering chief, Colin Campbell, said in March that the automaker would cut its use of SiC by 75 percent in its next powertrain platform -- without explaining how -- as part of an overall cost reduction of $1,000 per unit.

“Silicon carbide is an amazing semiconductor, but it’s also expensive and it’s hard to scale,” Campbell said. “So, using less of it is a big win for us.”

Share prices of big silicon carbide players dropped after Campbell’s announcement (but later recovered). However, others are also thinking about ways to reduce its use without compromising performance.

Soitec, a French semiconductor company whose engineered substrates have become near-ubiquitous in of RF (radio frequency) chips for smartphones, is developing a method it calls SmartSIC that can get 10 to 15 times more chip material from a single silicon carbide wafer.

Soitec’s SmartCut process -- think of it as an atomic knife -- extracts a fine layer of monocrystalline silicon carbide from a so-called donor wafer, which is then bonded to a polycrystalline wafer of ultra-low-resistivity silicon carbide. The donor wafer can then be re-used 10 times, said Emmanuel Sabonnadiere, vice president, automotive and industrial at Soitec.

The SmartSIC process can save 4,000 tons of CO2 for every 100,000 wafers, Sabonnadiere said. “It’s an ecofriendly system of wafer production,” he said. 

The engineered properties of the substrate make it more efficient, he said, ultimately leading to more efficient chips and inverters for EVs.

"Automakers can reduce the size of their inverters, and they can reduce the need for thermal management," he said. 

Soitec is partnering with STMicroelectronics to qualify the system, as well as talking to automakers and Tier 1 suppliers about commercial deployment. Sabonnadiere said he expects the qualification process to be completed by the end of 2024.

“There is a lot of interest from automakers, even if we are far apart in the supply chain,” he said. 

One company in discussions with Soitec is Volkswagen Group, which is seeking to vertically integrate its EV value chain, including making its own battery cells with its PowerCo unit and designing its own inverters for use in future EVs on the PPE architecture.

Silicon carbide chips will be integral to the performance and cost of those inverters, said Berthold Hellenthal, strategic semiconductor manager at Audi, who is also involved in VW Group’s overall semiconductor design strategy.

“We decided that everything in the [EV] drivetrain will be in our hands,” he said. “And to have a good symbiotic system performance the inverter is key. It connects the battery to the e-drive -- and this is where the magic happens.”

Silicon carbide chips may be more expensive than silicon chips, but they can lead to savings elsewhere, Hellenthal said. “Silicon carbide can make vehicles more affordable because you can either get more range from the same battery size, or you can use fewer battery cells,” he said. “You can save on cooling, too -- it's a question how you want to play it.” 

Dirk Walliser, the head of R&D at ZF, says prices will come down with scale and as companies develop expertise in the material.

“Now that we know how [to work with SiC], the advantage of silicon being a mass-produced product is gone,” he told Automotive News Europe. “With so many new EVs coming, the volume of silicon carbide production has increased, so the scale is there to pay back the investments.”

Douglas A. Bolduc contributed