Risks highlighted as silicon carbide market set to top $1bn by 2025

Market news |
By Nick Flaherty

The rise in demand for power electronics across various industry verticals such as medical, defence, aerospace, and others along with SiC-based photovoltaic cells in emerging economies such as Brazil, China, and India are expected to drive growth in the industry. The growth in 5G infrastructure is also driving the growth in the market, but there are signficant risks.

The huge initial cost and design challenges of SiC MOSFETs could restrain growth in the market. Another major impediment in the production of SiC-based power devices is the high wafer cost, says the report. The price of SiC semiconductors is higher than the silicon semiconductors that they have been aiming to replace and high-purity SiC powder and high-purity silane (SiH4) are the critical precursors for producing SiC layers in the chips. High-purity SiC powder is currently available from a limited number of suppliers such as Bridgestone, Pallidus and Washington Mills in the US and LGInnotek in Korea, while high-purity silane is produced by a few large multinational industrial gas companies. The fewer suppliers of these raw materials required in the manufacturing of silicon carbide wafers have resulted in their higher cost. The higher bargaining power of silicon carbide wafer suppliers hampers large-scale adoption of silicon carbide wafers say the analysts.

The power product segment contributed to nearly two-thirds of the total market share in 2017 and would maintain its dominance throughout the forecast period, registering the fastest CAGR of 19.5% from 2018 to 2025, owing to rise in demand of compact-sized pre-designed module and ability to provide high efficiency. Discrete products segment will have a steady growth over the forecast period.

The automotive segment would register the highest CAGR of 20.5% from 2018 to 2025, owing to increase in penetration of electric vehicles. The IT & Telecom segment accounted for nearly one-fourth of total market share in 2017 due to rise in demand for efficient power distribution systems for IT and telecommunication equipment. However, the industrial segment would overtake this segment in terms of revenue by 2025. Other segments explored in the research include aerospace & defense, energy & power, electronics, and healthcare.

Asia-Pacific is the lucrative region, contributing to nearly half of total market share in 2017, and expected to further strengthen its dominance by 2025, registering the fastest CAGR of 19.0% during the forecast period. Factors responsible for the fastest growth rate are rise in number of silicon carbide suppliers and increase in demand of power electronics in emerging economies including China, Japan, and South Korea.

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