Chip shortage prompts EV makers to shore up SiC supply

  • Market: Metals
  • 05/06/21

Automotive manufacturers are engaging with silicon carbide (SiC) power device suppliers to secure deliveries as they look to avoid a supply crunch similar to the ongoing global semiconductor shortage.

Electric vehicles (EVs) use a growing number of power management devices, including metal oxide semiconductor field-effect transistors (Mosfets) and insulated gate bipolar transistors (IGBTs). IGBTs are used to switch the current in the drivetrain and Mosfets are used in the drivetrain, battery management system and voltage converters.

Manufacturers are increasingly shifting from using silicon to silicon carbide and in some cases gallium nitride (GaN) in these devices. Prices for SiC devices are higher than for silicon devices, but by operating at higher temperatures and frequencies, they make EV batteries more efficient and reduce overall system costs.

The cost savings are encouraging carmakers to incorporate SiC into new EV designs, according to Gregg Lowe, chief executive at US-based Cree, which produces SiC and GaN power devices. Automotive accounts for around half of the company's $10bn device pipeline, Lowe said.

The production constraints that have resulted from the semiconductor supply shortage have prompted carmakers and original equipment manufacturers (OEMs) to look at their supply chains for other components, including Mosfets and IGBTs.

"The attention the car manufacturers and the Tier 1s have to our supply chain is very high and very acute," Lowe said.

US-based ON Semiconductor similarly noted strong demand for SiC and IGBT products for EVs from Tier 1 and global EV OEMs, a few of which have recently launched new platforms and charging applications. The company is also observing a shift in the way carmakers approach the supply chain.

"The just-in-time era is not going to be sustainable," the company's president, chief executive and director, Hassane El-Khoury, said. "The short-term cancellation, all of that I think is going to be a thing of the past."

German semiconductor manufacturer Infineon Technologies expects its SiC business to double to €170mn in the current fiscal year ending in September, led by growth in automotive demand, having previous expected a 70pc increase.

Capacity expansions accelerate

Companies are increasing their production capacity expansions or bringing forward plant starts to meet the growing demand.

Cree, which launched four new SiC devices in March, is spending $550mn this financial year to expand its production of SIC materials and wafers by 30 times. The investment, part of a five-year $720mn capital expenditure budget, includes the construction of a wafer fabrication plant in New York state in the US, which is scheduled to start operations in 2022. Cree is also expanding capacity at its materials factory in North Carolina.

Cree expects SiC demand to accelerate in 2024 and beyond based on carmakers' production schedules. "We weren't predicting this. But the capacity coming on line and in a relatively short period is certainly a nice light at the end of the tunnel for some of these guys as they start placing bets on silicon carbide," Lowe said.

Infineon is starting to ramp up its manufacturing of silicon carbide products for vehicle inverters. It started installing equipment in a new manufacturing plant in Austria in March, Ploss said. The company is bringing forward the start of production at the plant to the last quarter of the fiscal year ending in September. And it is increasing investments in capacity, having revised them lower in 2019 when demand was weaker.


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Europe longs: Buyers delay restocking

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Viewpoint: Unlocking Africa's Copperbelt


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Viewpoint: Unlocking Africa's Copperbelt

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Thailand approves wider incentives plan for EV sector


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02/21/24

Thailand approves wider incentives plan for EV sector

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Investors push EV sector on responsible nickel mining


02/21/24
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02/21/24

Investors push EV sector on responsible nickel mining

Singapore, 21 February (Argus) — A group of financial institutions has identified electric vehicle (EV) and battery manufacturers' shortcomings as it pressures for stronger corporate actions to ensure responsible nickel mining. The signatories directed their "expectations" at major EV stakeholders, naming global auto producers Tesla, Toyota, Hyundai Motor and BMW, as well as battery manufacturers BYD, Samsung SDI and Panasonic. The group consists of 29 investors, representing over $1.2 trillion of combined assets. It includes Dutch pension fund PGGM, Indian conglomerate Future Group, Dutch insurance co-operative Achmea and DNB Asset Management that is owned by Norway's DNB bank. "As responsible investors, we are concerned that companies that do not proactively address the social and environmental risks with the appropriate actions put long-term value creation and investment returns at risk," said the signatories on 20 February. They highlighted concerns including deforestation, higher greenhouse gas emissions and conflicts with indigenous peoples and local communities following greater public attention. The statement focused on nickel, among other critical minerals like cobalt and lithium, as nickel has attracted more public attention because of environmental risks associated with its extraction. "The single-largest growth in the demand of nickel in the next two decades is expected to come from the EV industry. However environmental impacts are often overlooked in the downstream mineral supply chain policies of EV battery producers and EV manufacturers," the group said. "Downstream companies have the responsibility to ensure that environmental and social risks are mitigated throughout their nickel supply chains." The signatories laid out three sets of expectations. They expect firms to incorporate responsible sourcing requirements in their nickel supply chains and to exercise their leverage with upstream firms to ensure responsible mining practices. Requirements include a commitment to implement and respect the free, prior and informed consent of indigenous peoples and local communities, as well as "time bound commitment" for net zero smelting and refining processes. They expect enhanced social and environmental due diligence from those stakeholders, with increased impact disclosures. They also expect "time-bound commitments" for deforestation-free nickel supply chains, citing a 2023 report by environmental group the World Wide Fund for Nature that suggested destruction of at least 273km² of forests throughout 2001-19 were caused by nickel extraction, mostly in southeast Asia. "There is no credible pathway to net zero without halting deforestation by commercial actors by 2025," said the signatories. They expect measures by 2025 the latest from those firms to "eliminate" deforestation from their nickel supply chains. Nickel from Indonesia has flooded the market in recent years. It added an estimated 1.17mn t of production during 2021-23, according to Australian bank Macquarie's research arm. Australia's nickel sector has been hit particularly hard this year, as the country scrambles to provide royalty relief and include nickel in its critical minerals list to support its producers. But a green premium on low-carbon battery grade nickel is unlikely to happen , with the Indonesian carbon footprint coming down all the time, said some market participants. By Joseph Ho Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Rio Tinto signs new power deal for Australian aluminium


02/21/24
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02/21/24

Rio Tinto signs new power deal for Australian aluminium

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