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About the inverter industry: IGBT replacement and technology trends in China(2)

Dec 04, 2020

About the inverter industry: IGBT replacement and technology trends in China

IGBT competition pattern: Europe, America and Japan are basically monopolized, and China's production share is extremely low

The competitive landscape of the IGBT market is relatively concentrated. The main competitors include Infineon, Mitsubishi, Fuji Electric, ON Semiconductor, ABB of Switzerland, etc. In 2017, the world's top five IGBT manufacturers accounted for more than 70%, and the current market share of Chinese companies is generally small.

IGBTs mostly appear in the form of IGBT modules. The market share of China's IGBT leader Star Semiconductor in the module field in 2018 was 2.2%. According to Star Semiconductor's 2018 revenue of 675 million yuan, the market space for IGBT modules in 2018 was close to 30 billion. Yuan (of which the overall market space of IGBT in 2018 is 5.836 billion US dollars)

There is vast room for substitution of Chinese products. At present, only Star Semiconductor has made China’s IGBT modules in the world’s top 10, but it only accounts for 2.2% of the global IGBT module market. Due to the downstream applications of IGBTs in emerging fields such as new energy vehicles, photovoltaics, and wind power, China is in the world. The right to speak is higher than the traditional fuel vehicle field and industrial control field in the past. Therefore, more than half of the demand for IGBT growth is in China. In the next few years, China’s IGBT market demand will increase from less than 35% in 2019 to 50% or more in 2025 will create good conditions for Chinese IGBT manufacturers to increase their share and competitiveness. The market share and business volume of Chinese-made IGBT manufacturers have great potential to increase.

Determining high growth: driving factors for IGBT boom in the next five years

IGBT accounts for nearly 8% of the cost of new energy vehicles and is a purely incremental product

The main applications of IGBT in the field of electric vehicles are divided into three categories:

1) Electronic control system: IGBT module converts DC to AC and then drives the car motor (electronic control module);

2) Vehicle air conditioner control system: low-power DC/AC inverter, the working voltage of this module is not high, and the unit price is relatively low;

3) The IGBT module in the charging pile is used as a switch: the cost of the IGBT module in the charging pile accounts for close to 20%;

According to data from Digitimes Research, the current cost structure of new energy vehicles:

1) Battery cost accounts for the largest proportion, generally speaking, it can account for more than 40% of the total cost of electric vehicles;

2) The second largest proportion of cost is the motor drive system, which can reach 15%-20% of the total cost of electric vehicles, while IGBT accounts for 40%-50% of the motor drive system cost, that is, IGBT accounts for new energy The total cost of the car is close to 8%.

Moreover, for IGBTs, the demand for IGBTs in new energy vehicles is a pure increase, because traditional fuel vehicles have low power semiconductor devices and only need Si-based MOSFETs, while new energy vehicles above 600V MOSFETs cannot meet the requirements and must be replaced. IGBT; therefore, IGBT is the second most beneficial component after batteries.

Each new energy vehicle is expected to require 450 US dollars of IGBT: According to Yole Development’s calculations, in 2016, each vehicle consumed an average of about 450 US dollars of IGBTs. Among them, ordinary hybrid and plug-in hybrids require about 300 US dollars of IGBTs per vehicle. Electric vehicles use an average of US$540 IGBT per vehicle.

According to the average bicycle IGBT consumption in 2019 of US$460, benefiting from the continuous increase in the proportion of BEV, it is expected that the bicycle consumption will increase to US$490/vehicle in 2022 in 2019-2022. Starting from 2023, the average bicycle consumption of SIC-MOS will be mature. The usage gradually declines to US$430 per vehicle in 2025, and the sales volume of new energy vehicles is forecasted to be 5.04 million in 2025 (according to the national new energy vehicle industry development plan-the penetration rate of electric passenger vehicles in 2025 is estimated to be approximately 25%.)

Based on the above assumptions, simply estimate that China’s automotive IGBT market will reach US$2.2 billion in 2025, which is also a large number. By then, the number of global new energy vehicles is expected to be three times that of China (that is, overseas sales will be twice that of China). The IGBT market has reached 6.6 billion U.S. dollars, which is equivalent to recreating an IGBT market (the total global IGBT in 2019 is on the order of 6 billion U.S. dollars).

IGBT continues to benefit from the increase in the proportion of photovoltaic and wind power in the energy structure

Rectifiers and inverters in wind power and photovoltaics require IGBT modules. According to data from the Energy Administration, China's installed PV capacity was 30.11GW in 2019, and the global PV installed capacity was 115GW.

China's photovoltaic power generation accounted for 3% of the total power generation in 2019, and there is great potential for continued improvement in the future. According to the "China Photovoltaic Development Outlook in 2050" of the United Nations Climate Change Conference in Madrid, starting from 2020 to 2025, China's photovoltaics will start to accelerate deployment; from 2025 to 2035, China's photovoltaics will enter a period of large-scale and accelerated deployment. By 2050, photovoltaics will become China's largest power source, accounting for about 40% of the country's electricity consumption that year, and there is still a large space and potential for future photovoltaic development.

The global demand for wind power and photovoltaics corresponding to IGBTs in 2025 will be 1.5 billion U.S. dollars: The total space of IGBTs and the proportion of new energy power generation estimated by the aforementioned Zhiyan Consulting and Infineon can be calculated (IGBT 2018 global market space is 5.8 billion U.S. dollars, Among them, photovoltaic wind power and other IGBT applications accounted for 9%). In 2018, the photovoltaic wind power IGBT market space is about 522 million US dollars. In the current energy structure, solar and wind energy together account for less than 10%. In the context of global energy conservation and emission reduction, reducing dependence on fossil energy and increasing the use of solar and wind energy have become the consensus of all countries in the world. According to BloombergNEF's forecast, the global new installed capacity of photovoltaics is expected to be close to 300GW in 2025, and wind power will increase by about 2.5 times compared with photovoltaics in 5 years. It is estimated that the global demand for wind power and photovoltaics corresponding to IGBTs in 2025 will be 1.2 to 1.5 billion US dollars.

Inverter drive IGBTs for white goods continue to grow

IGBT is one of the core components of "frequency converter", and the promotion of frequency conversion white goods can bring a stable market for IGBT IPM. At present, there is still room for improvement in the frequency conversion penetration rate of white goods: According to Industry Online, the frequency conversion penetration rate of China's white goods has continued to increase in recent years: 1) Air conditioners: From 2012 to 2018, the sales volume of frequency conversion air conditioners in China has increased from 30.16 million units to 6,434 10,000 units, the penetration rate increased from 28.94% to 42.70%; 2) Refrigerators: From 2012 to 2018, the sales of inverter refrigerators in China increased from 3.63 million units to 16.65 million units, and the penetration rate increased from 4.80% to 22.15%; 3) Washing machines : From 2012 to 2018, China's inverter washing machine sales increased from 5.77 million units to 21.63 million units, and the penetration rate increased from 10.36% to 32.97%. Yole predicts that the white goods variable frequency drive IGBT market will reach US$990 million in 2022, an increase of 22% from 2017.

China’s low production of variable frequency white power IGBTs: Only Silan Microelectronics and China Microelectronics have some white power IPM modules shipped. Although the unit price of home appliance IPM modules is low, the motivation to replace suppliers is not strong, and the downstream is concentrated At present, the leading companies’ suppliers are Japanese and American companies. For example, Midea is mainly Sanyo and Fairchild; Gree/Haier is mainly Mitsubishi, and some IR and LS are supplying. When the supply chain security is threatened by the external environment In the future, Chinese IGBT manufacturers still have great potential for substitution in this niche market.

Industrial control field is the basic board of IGBT application

IGBT modules are the core components of traditional industrial control and power supply industries such as frequency converters and inverter welding machines, and have been widely used in this field.

1) Inverter industry

The overall market size of China's inverter industry is on the rise. The IGBT module not only plays the role of a traditional triode in the inverter, but also includes the role of the rectifier part. According to the Qianzhan Industry Research Institute, the market size of China's inverter industry in 2016 was 41.677 billion yuan, with an average 4-year compound growth rate of 8.74%. In 2017, the scale of China's inverter market was approximately 45.32 billion yuan. In the next few years, the market for high-voltage inverters with high-efficiency and energy-saving functions will continue to grow, driven by policies. By 2023, the market for high-voltage inverters will reach about 17.5 billion yuan.

2) Inverter welding machine industry

Inverter arc welding power source, also known as arc welding inverter, is a new type of welding power source. This kind of power supply generally converts the three-phase power frequency (50 Hz) AC network voltage into a direct current through the input rectifier rectification and filtering, and then through the alternating switching action of high-power switching electronic components (IGBT), the inverter becomes a few According to the data of the National Bureau of Statistics, the output of China's electric welding machine was 8.533 million units in 2018, an increase of 584,600 units compared with 2017. The continuous heating up of the welding machine market will also ensure the gradual increase in IGBT demand.

The global industrial control IGBT downstream market is relatively fragmented: According to TrendForce Consulting data, the global industrial control market IGBT market size in 2019 is about 14 billion yuan, and the Chinese industrial control market IGBT market size is about 3 billion yuan. Due to the dispersion of downstream demand in the industrial control market, the growth of a single downstream demand is difficult to promote the overall industry demand. Therefore, the demand in the industrial control IGBT market is relatively stable. Assuming a 3% annual growth rate in the future, the global industrial control IGBT market is expected to reach 170 by 2025 100 million yuan. This is the basic disk of the IGBT industry, with stable demand and relatively small fluctuations.

High market attention: how to treat the challenge of third-generation semiconductor materials to IGBT

Introduction to Wide Band Gap Semiconductors

Many power semiconductor giants around the world have laid out the next generation of power semiconductors based on gallium nitride (GaN) and silicon carbide (SiC), laying the foundation for competing with traditional silicon-based power semiconductor devices in the market.

SiC and GaN are third-generation semiconductor materials. Compared with the first and second-generation semiconductor materials, the third-generation semiconductor materials have a wider band gap, higher breakdown electric field, higher thermal conductivity, and higher The electron saturation rate and higher anti-radiation ability are more suitable for making high-temperature, high-frequency, anti-radiation and high-power devices. They are usually called wide-bandgap semiconductor materials.

High frequency and low voltage use Si-IGBT, high frequency and high voltage use SiC MOS, the voltage power is not large, but high frequency uses GaN. When using Si under low frequency and high pressure

Compared with Si, the on-resistance of SiC can be made lower, which is reflected in the product, that is, the size is reduced, thereby reducing the volume. In the new energy automobile industry, because the weight of the battery is also relatively large, the substantial reduction of other devices will be more helpful to the light weight of the new energy vehicle; for example, the DC/DC of about 5KW is lighter than the Si IGBT. Around 85%.

Subject to cost issues, IGBT is still the most important application in the next 3-5 years

The current limitation of the use of SIC is that the cost is too high and the product parameters are also unstable. At present, the cost of SIC chips is 4-5 times that of IGBTs, but the industry predicts that the cost of SiC can drop to about 2 times within three years. The current model that uses SiC MOS is Tesla's Model 3.

At present, the main reason hindering the cost reduction of SiC is substrate defects. The strategic marketing director of Applied Materials commented: "This wide band gap gives the material excellent characteristics, such as faster switching speed and higher power density, but the main challenges are substrate defects, basal plane dislocations and Screw dislocations can produce "fatal defects," and SiC devices must reduce these defects in order to achieve the high yields required for commercial success."

Cost reduction and product stability require time to verify. The core contradiction of Chinese manufacturers is the substitution of Chinese products. The stability of SiC MOSFET products needs further verification. According to the disclosure of experts at Infineon's 2020 Power Semiconductor Application Conference, the time for SiC MOSFET to actually land is very short, and it has just begun to be commercialized in the automotive field. Some technologies such as short circuit withstand time The indicators do not provide enough verification. It takes a relatively long time for a high-end power semiconductor to go from customer certification to product trial application to product mass application. Therefore, IGBTs will still be mainstream high-end power semiconductor products in the next 3-5 years, and SiC will be part of the There is some gradual and slow penetration in the field of high-end new energy vehicles. But for Chinese manufacturers, the core contradiction in the next five years is the substitution of Chinese products (leading market share from 2% to 20%).

Long-term perspective: While replacing IGBTs made in China, there are also forward-looking layouts for SiC

The third-generation material SiC is one of the directions of power semiconductor technology evolution. China IGBT also has some research and development reserves and sample launches. The following are examples of Star Semiconductor and CRRC Times Electric:

1. Star Semiconductor: The company's SiC-related products and technical reserves are in full swing

1. The company has successfully developed related technologies for silicon carbide modules

According to the disclosure of Star Semiconductor's prospectus: the company's research and development of silicon carbide module related technologies mainly include:

a. Silver paste sintering technology: After sintering with silver paste, the melting point of the connecting layer can reach more than 900 degrees, which is 4 times the melting point of the connecting layer of the soldering process. It is suitable for applications where the working temperature is above 200 degrees; the conductivity of the silver paste sintered layer 、The thermal conductivity is 5 times and 4 times of the solder connection layer respectively;

b. Copper wire bonding technology: Compared with aluminum wire, the melting point of copper wire is increased from 660C to 1083C, which can greatly improve the overcurrent capability of aluminum wire. At the same time, its thermal conductivity, resistivity and Young's modulus are significantly better than aluminum wire, and its thermal expansion coefficient is reduced from 23.6 of aluminum wire to 16.5, which can greatly reduce the stress of the connection layer when the chip is working, and improve the resistance of the chip. Power cycling capability.

2. The progress of the company's key project reserves

The prospectus contains an introduction to the company’s key project reserve progress under research, including the fourth reserve:

1) Project name: Development of wide bandgap semiconductor device power module;

2) Project progress: At present, SiC device modules for photovoltaic applications have been developed for mass use by customers, and sample certification for automotive SiC modules has been completed.

3) The intended purpose of the project: to further improve the product series, and to improve the SiC devices for photovoltaic applications and the SiC module products for new energy vehicles in 2019.

3. The company's key technology research and development plan in the future:

Three important product developments are mainly mentioned: 1. The research and development of a full range of FS-Trench IGBT chips; 2. The research and development of a new generation of IGBT chips; 3. The research and development, design and mass production of cutting-edge power semiconductor products such as SiC and GaN: The company will adhere to scientific and technological innovation and continuously improve the layout of the power semiconductor industry. While vigorously promoting conventional IGBT modules, the company will rely on its own professional technology to actively deploy wide bandgap semiconductor modules (SiC modules, GaN modules), and continue to enrich its product categories and strengthen Own competitiveness and further consolidate its own industry position.