Wolfspeed's Bankruptcy Filing and Renesas Disbands Silicon Carbide Team

According to a recent report by Nikkei News, the slowdown in the electric vehicle market and the continuous increase in production by Chinese silicon carbide (SiC) manufacturers have led to an oversupply in the silicon carbide market and a decline in prices. This has prompted the Japanese semiconductor giant Renesas Electronics to potentially abandon the production of silicon carbide power semiconductors for electric vehicles.

It was reported that the plan to start production of automotive silicon carbide power semiconductors at the Takasaki plant in early 2025 has now been scrapped, and Renesas has disbanded the silicon carbide team at the Takasaki plant. In addition to abandoning the production of automotive silicon carbide power semiconductors, Renesas has also revised its production plans for silicon-based power semiconductors.

The main reason for Renesas’s decision to abandon the production of automotive silicon carbide power semiconductors is the end of subsidy funding in Europe, which has resulted in electric vehicle sales growth falling short of expectations. Meanwhile, Chinese companies have increased production of silicon carbide power semiconductors, leading to an oversupply in the market and a continuous decline in prices for silicon carbide power semiconductors.

It is noteworthy that Wolfspeed, the world’s largest silicon carbide manufacturer, is facing a debt crisis of up to $6.5 billion due to intensified market competition and ongoing massive losses, and is preparing to file for bankruptcy reorganization. Last November, Wolfspeed announced a 20% workforce reduction and the closure of multiple sites and factories, further reflecting the fierce competition in the silicon carbide market.

According to the research firm Fuji Economic, the market size for silicon carbide power semiconductors is expected to grow by 18% year-on-year to 391 billion yen in 2024, which is lower than the previous estimate of 491.5 billion yen made in February 2024.

The latest report from market research firm TrendForce also indicates that due to weakened demand in the automotive and industrial sectors in 2024, the global shipment growth of silicon carbide substrates is slowing. At the same time, intensified market competition has led to a significant drop in product prices, resulting in a 9% year-on-year decline in revenue for the global N-type (conductive type) SiC substrate industry, down to $1.04 billion in 2024.

Previous data showed that due to the continuous expansion of silicon carbide production capacity in China, the price decline of silicon carbide substrates is far outpacing the speed of market expansion. By the second half of 2024, the price of 6-inch silicon carbide substrates has fallen below $500, approaching the production cost line, a drop of over 90% compared to prices in 2022.

From the current market landscape of silicon carbide substrates, despite facing significant operational challenges in recent years, Wolfspeed still maintains its position as the largest player, with a market share of 33.7% in 2024. However, Chinese manufacturers TanKeBlue and SICC have rapidly developed in recent years, continuously increasing their market shares, ranking second and third with market shares of 17.3% and 17.1%, respectively. TanKeBlue is the largest supplier of silicon carbide substrates in the domestic power semiconductor market, while SICC holds a leading position in the 8-inch silicon carbide wafer market. Additionally, Xiamen Silan Microelectronics, a subsidiary of Silan Micro, and the joint venture Anifa Semiconductor between STMicroelectronics and Sanan Optoelectronics are also vigorously developing 8-inch silicon carbide.