With the transfer of global manufacturing to China, my country’s power semiconductor market accounts for more than 50% of the world market, and it is the largest IGBT market in the world.
However, IGBT products rely heavily on imports, and more than 90% of IGBT devices in the mid-to-high-end field rely on imports. The demand for IGBT localization is urgent.
The global IGBT market is finally dominated by Europe, America, Japan and South Korea
Such as Infineon, Mitsubishi, Fuji Electric, ON Semiconductor and ABB and other companies, the market share of the top five companies has exceeded 70%.
From the perspective of the entire card, our domestic IGBT companies can only eat “leftovers”.
U.S. power devices are in a leading position in the world and have a number of manufacturers with global influence, such as TI, Fairchild, NS, Linear, IR, Maxim, ADI, ON Semiconductor, AOS and Vishay.
Europe has three global semiconductor manufacturers, Infineon, ST and NXP, with complete product lines and leading strengths in both power ICs and power separation devices.
Japanese power device manufacturers mainly include Toshiba, Renesas, NEC, Ricoh, Sanke, Seiko, Sanyo, Sharp, Fujitsu, Toshiba, Rohm, Matsushita, FujiElectric and so on.
In recent years, Taiwan’s power chip market has developed rapidly, with a number of manufacturers such as Richtek, Fuding Advanced, Maoda, Anmao, Zhixin and Peiheng.
More than a decade ago, IGBTs, like today’s lithography machines, were banned from selling high-end products in China.
International IGBT giants stipulate that Chinese companies can only use IGBTs in the inverter industry to buy high-end IGBTs to build new energy vehicles. It is absolutely forbidden. Domestic companies have to embark on a road of independent research and development.
There is a vast space for domestic alternatives
In the incremental space of IGBT, more than half of the demand is in China. In the next few years, the proportion of my country’s IGBT market demand will increase from 35% in 2019 to 50% or more in 2025.
It is simply estimated that the size of China’s automotive IGBT market in 2025 will reach 2.2 billion US dollars. At the same time, it is a large number. By then, the number of new energy vehicles in the world is expected to be three times that of the domestic market, and the global automotive IGBT market will reach 6.6 billion US dollars, which is equivalent to rebuilding an IGBT market.
By 2020, the global IGBT single-tube market space will reach about 6 billion US dollars, and the market space is huge. It is expected that in the next five years, my country’s new energy vehicle and charging pile market will drive the domestic market demand for IGBT Modules of 20 billion yuan.
According to BloombergNEF’s forecast, it is estimated that the new installed capacity of photovoltaics in the world will be close to 300GW in 2025, and wind power will also increase by about 2.5 times compared with photovoltaics in five years. It is estimated that the global demand for IGBTs corresponding to wind power and photovoltaics in 2025 will be in the order of 1.2-1.5 billion US dollars.
At the same time, domestic semiconductor power companies often have comparative advantages in cost and customization compared with foreign manufacturers, and the domestic power semiconductor industry has a high possibility of realizing import substitution.
On the supply side, self-controllability is the development trend. At the same time, domestic IGBT companies often have comparative advantages in cost and customization compared to foreign manufacturers.
Coupled with the support of national policies and social capital, there is still a high possibility to achieve domestic replacement of IGBTs in the future.
Domestic substitution in the field of military power semiconductors in the short term, and long-term civilian new energy vehicle IGBTs have a huge space for imagination. On the basis of its own operation of military components such as resistance, capacitance, discrete devices, etc., it entered the IGBT field after horizontal acquisition, which highly overlaps with its own business scope.
In the long run, the long-term upward trend of my country’s electric vehicle development will remain unchanged. With the determination of the competition pattern of new energy vehicle factories, the leading effect of my country’s civil IGBT companies will become prominent.
The technology gap is narrowed + the cost advantage is highlighted as a trend
From the perspective of the whole industry chain, the initial capital expenditure of IGBT is large, the mid-term manufacturing yield is important, and the later market development needs to be cultivated, and the barriers are extremely high.
In terms of mass production experience and loading volume, overseas giants such as Infineon have rich experience in mass production, and BYD in the domestic market has unique advantages in the stable application scenarios of its own brand electric vehicles.
Since the sixth generation of technology, major manufacturers have begun to shift their energy to IGBT packaging. In terms of IGBT packaging materials, Japan is far ahead in the world, Germany and the United States are following the trend, and my country’s material science is relatively backward.
With the successive production of 8-inch wafer production lines of domestic enterprises, the yield rate has gradually increased, and the price of domestic IGBTs is expected to drop significantly compared with the previous purchase of giant wafers such as Infineon.
Domestic enterprises enter accelerated mode in IGBT layout
The development of domestic manufacturers has its own advantages. From the demand side, China’s demand for power semiconductors ranks first in the world; from the supply side, independent controllability is the development trend.
At the end of April this year, the BYD IGBT project has started construction in Changsha. After the project is completed, it can produce 250,000 pieces of 8-inch new energy vehicle Electronic cores per year, which can meet the annual capacity demand of 500,000 vehicles.
In addition, other manufacturers are also accelerating the construction of IGBT production capacity. Star Semiconductor’s new energy vehicle IGBT module expansion project can produce 1.2 million new energy vehicle IGBT modules annually after it is put into operation.
CRRC Times Electric has completed the release of the first IGBT production line with an investment of 1 billion yuan, and the second production line with an investment of 3.5 billion yuan is expected to start trial production at the end of 2020, with an output value of 4 to 5 billion yuan.
Hua Hong Semiconductor announced on July 31 that its 8+12-inch high-power semiconductor production line will make full efforts to actively undertake IGBT foundry business.
The first-phase production capacity of Sunking Power Electronics will be completed and put into operation in early 2021, and it is planned to form a production capacity of 2 million IGBT modules no later than 2024.
According to the 2020 semi-annual report released by China Resources Micro, the company currently has a total of 13 research projects, including IGBT product design and process technology research and development.
IGBT technology and barriers have become difficult points
IGBT is difficult to manufacture and has extremely high technical barriers. China’s power semiconductor market accounts for about 50% of the world market share, but the mid-to-high-end MOSFET and IGBT mainstream device markets are basically monopolized by European, American and Japanese companies.
Domestic IGBT technology (chip design, wafer manufacturing, module packaging) is currently in its infancy. Domestic IGBT companies are far behind the world’s advanced level in terms of R&D and manufacturing processes.
Therefore, latecomers in the industry often need to go through a long period of technical exploration and accumulation in order to compete with companies that already have technological advantages in the industry.
The specifications of IGBT modules used in high-speed rail, smart grid, new energy and high-voltage inverters are above 6500V, with strong technical barriers;
The high degree of integration of IGBT technology has led to a high degree of market concentration. Therefore, international manufacturers such as Infineon, Mitsubishi and Fuji Electric have natural market advantages, which makes the development of domestic manufacturers lose another opportunity.
In addition, the IGBT industry has difficulties such as high technical threshold, lack of talents, difficult market development, and large capital investment, and domestic enterprises have always progressed slowly in the process of industrialization.
IGBT modules are key components in downstream products, and their performance, stability and reliability are critical to downstream customers, so certification cycles are long and replacement costs are high.
Therefore, even if new entrants develop and produce IGBT products, it will take a long time to win the recognition of customers.
Domestic production capacity cannot achieve a balance between supply and demand
However, compared with the surge in domestic IGBT market demand, the output of the domestic IGBT market cannot achieve a balance between supply and demand.
In addition to the unbalanced supply and demand and the inability of existing production to meet the fiery market demand, technology is also another major flaw in domestic IGBTs.
With the accelerated development of rail transit, smart grid, aerospace, electric vehicles and new energy equipment and other fields, the domestic IGBT demand has ushered in an explosion, and the domestic IGBT market scale has shown an accelerated growth trend in recent years.
According to different configurations of electric passenger vehicles, the value of IGBT bicycles is as high as 1000-5000 yuan. In 2020, the global space is close to 10 billion yuan. With the rapid growth of global electric vehicle production and sales, it is expected that the industry space is expected to reach 37 billion yuan in 2025, with a CAGR of about +30%.
The subsidy for new energy vehicles has declined, electric drive companies and OEMs are facing pressure to reduce costs, and the price advantage of domestic IGBTs is obvious.
In the face of the huge increase in IGBT demand, the production capacity of companies in the industry expanded in a timely manner: BYD opened a closed-loop supply chain for automotive-grade IGBT products, and built a BYD IGBT4.0 factory in Changsha to meet the company’s demand for external IGBT supply.
Import dependence is difficult to shake in the short term
Inverters, converters and other photovoltaic and wind power technology devices are inseparable from IGBT devices. In recent years, although photovoltaic power generation and wind power generation have moved towards the international frontier and the entire industrial chain has been localized, its core power device IGBT is still dependent on Imports, the degree of dependence is 90%.
Although the converters began to be localized later, the core device IGBT is still mainly imported, mostly from Germany and Japan.
For the wind power industry, the development of domestic IGBTs requires a cultivation period. We can’t wait until the domestic product is mature before we start to use it, otherwise it will not be conducive to the growth of domestic IGBT.
As the core component of electrification, IGBT has high barriers to entry. At present, the localization rate is low, and the supply has been monopolized by European, American and Japanese companies for a long time.
With the maturity of IGBT technology and the rapid development of domestic enterprises, it has been gradually applied to electric vehicles in batches, and it is expected to gradually realize domestic substitution in the long run.
Because independence is the way to survive the development of the semiconductor industry.
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