The gap between supply and demand for automotive-grade IGBTs is giving Chinese manufacturers new opportunities, but shortages remain and may deepen

By Li Panpan

IGBTs consumption in China has surged, driven by the rapid development of new energy vehicles. However, the production capacity of upstream suppliers fails to keep up with the market demand, according to a JW Insight analyst article.

Electronic control is one of the three core components of automobile electrification. IGBT accounts for 40% of the electronic control system’s cost and is widely used in thermal management systems, charging inverter systems, and body control systems.

The rapid development of vehicle electrification drives surging IGBT consumption in China, leading the global new energy vehicle industry. China’s new energy vehicle sales in 2021 were 3.521 million, a year-on-year increase of 1.6 times; the figure is expected to reach about six million this year, according to data from the China Association of Automobile Manufacturers(CAAM) and China Passenger Car Association (CPCA).

However, the pandemic and IGBT manufacturers’ production capacity shortfall have led to a tight supply of automotive-grade IGBTs.

This February, some industry insiders warned that IGBT might become an important device that will affect the production of new energy vehicles in the second half of the year. The impact of its shortage may exceed that of MCUs.

There might be cases where automobile manufacturers “falsely report” their demand when the market is in tight supply. However, the imbalance between the supply and demand of automotive-grade IGBTs has existed for a long time, and the production capacity shortage has been felt since last year.

Due to the extended supply cycle of Infineon, some Chinese EV manufacturers have started to turn to local suppliers in 2021. BYD signed an IGBT supply order at the end of 2021 with Silan Micro(士兰微), giving itself relief. But other new energy vehicle OEMs may face enormous pressure, said industry insiders.

Chinese IGBT suppliers have obtained many orders from vehicle OEMs in 2021. StarPower Semiconductor(斯达半导体) has put products into low-end new energy models with help from Chinese industrial control companies such as Inovance Technology(汇川技术) and INVT(英威腾). Industry insiders speculate that the installed number of its IGBTs may have reached 300,000 to 500,000 in 2021.

According to the statistics of NE Times, an American newspaper, the top five producers with IGBT installed capacity of power modules for EVs in China in Q1 2022 are Infineon, Star Semiconductor, BYD Semiconductor, ST, and CRRC Times Electric. 

It is worth noting that the year-on-year growth rates of the three Chinese companies, Star Semiconductor, BYD Semiconductor, and CRRC Times Electric, were 203.3%, 209.6%, and >500%, respectively, much higher than the 78.2% year-on-year growth rate of Infineon. And the total installed capacity of the three was 443,000 sets, with a total market share of 39.9%.

Those three IGBT producers entering the top five in the Chinese market reflects the rapid growth of local power device companies in 2021, and the Chinese power module market is possible to change with the current opportunities caused by production capacity shortage.

Although Chinese IGBT producers have grown rapidly, the wafers and IGBT chips required by them still rely on international suppliers, which cannot meet the surging market demand in China. 

BYD Semiconductor and CRRC Times Electric are both in the early stage of construction with their new wafer production lines and no additional production capacity to be released. Others like Huahong Semiconductor, GTA Semiconductor, Silan Micro, CR Micro, and SMIC Shaoxing are just newcomers producing automotive-grade IGBTs.