Owing to the EV market’s substantial demand for longer driving ranges and shorter charging times, automakers’ race towards high-voltage EV platforms has noticeably intensified, with various major automakers gradually releasing models featuring 800V charging architectures, such as the Porsche Taycan, Audi Q6 e-tron, and Hyundai Ioniq 5. According to TrendForce’s latest investigations, demand from the global automotive market for 6-inch SiC wafers is expected to reach 1.69 million units in 2025 thanks to the rising penetration rate of EVs and the trend towards high-voltage 800V EV architecture.

The revolutionary arrival of the 800V EV charging architecture will bring about a total replacement of Si IGBT modules with SiC power devices, which will become a standard component in mainstream EV VFDs (variable frequency drives). As such, major automotive component suppliers generally favor SiC components. In particular, Tier 1 supplier Delphi has already begun mass producing 800V SiC inverters, while others such as BorgWarner, ZF, and Vitesco are also making rapid progress with their respective solutions.

At the moment, EVs have become a core application of SiC power devices. For instance, SiC usage in OBC (on board chargers) and DC-to-DC converters has been relatively mature, whereas the mass production of SiC-based VFDs has yet to reach a large scale. Power semiconductor suppliers including STM, Infineon, Wolfspeed, and Rohm have started collaborating with Tier 1 suppliers and automakers in order to accelerate SiC deployment in automotive applications.

It should be pointed out that the upstream supply of SiC substrate materials will become the primary bottleneck of SiC power device production, since SiC substrates involve complex manufacturing processes, high technical barriers to entry, and slow epitaxial growth. The vast majority of n-Type SiC substrates used for power semiconductor devices are 6 inches in diameter. Although major IDMs such as Wolfspeed have been making good progress in 8-inch SiC wafer development, more time is required for not only raising yield rate, but also transitioning power semiconductor fabs from 6-inch production lines to 8-inch production lines. Hence, 6-inch SiC substrates will likely remain the mainstream for at least five more years. On the other hand, with the EV market undergoing an explosive growth and SiC power devices seeing increased adoption in automotive applications, SiC costs will in turn directly determine the pace of 800V charging architecture deployment in EVs.

For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms. Latte Chung from the Sales Department at lattechung@trendforce.com

Total global sales of NEVs (new energy vehicles) for the first three quarters of 2021 (January-September) reached 4.2 million units, with BEVs in particular accounting for 2.92 million units, a 153% YoY growth, according to TrendForce’s latest investigations. Total sales of PHEVs, on the other hand, reached 1.28 million units, a 135% YoY growth. Compared to the overall automotive market, whose growth has been constrained by the ongoing semiconductor shortage and effects of the COVID-19 pandemic, sales of NEVs still remained relatively strong.

Regarding BEV sales, Tesla comfortably took the leadership position with a 21.5% market share. The automaker’s sales volume for the first three quarters of this year already surpassed its sales volume for 2020. Taking second place on the top 10 list, Wuling Hongguang was able to maintain its high volume of sales due to not only low retail prices, but also a gradual expansion of its target markets from tier-three and tier-four cities to tier-one and tier-two cities in China. This shift would seem to indicate a corresponding expansion of and shift in Wuling Hongguang’s customer base. BYD and Volkswagen took third and fourth places, respectively, with the latter aggressively consolidating its BEV offerings into the ID. Family this year. Vehicles in the ID. Family have accounted for nearly all of Volkswagen’s BEV sales since 3Q21. Despite the rapid growth of the BEV market, competition has been intensifying after traditional automakers began releasing their own BEV models at a faster pace while emerging automakers also began delivering vehicles.

It should be noted that, although the global semiconductor shortage has not damaged the NEV market to the same degree as it did the traditional ICE vehicle market, the NEV market is not entirely immune to the resultant supply-side issues. In addition, China’s power rationing and pandemic-generated transportation/logistics disruptions likewise affected automakers’ manufacturing operations to various degrees. Taken together, these aforementioned factors became some of the underlying causes responsible for the shifts in NEV automakers’ market shares.

Regarding PHEV sales, BYD put up a remarkable performance by leapfrogging to second place in the rankings, and this can primarily be attributed to the release of BYD’s DM-i vehicles, which feature a super hybrid technology aimed at reducing fuel consumption. Thanks to the DM-i vehicles, BYD’s PHEV sales began skyrocketing in 2Q21, and the automaker was able to overtake several European automakers with respect to total PHEV sales for the first nine months of 2021. Much like the BEV market, despite the growths in most automakers’ sales volumes, companies will find it increasingly difficult to raise their PHEV market share.

Looking ahead to the NEV market’s future, TrendForce believes that, as traditional global automakers gradually kick off mass production of vehicles based on the battery electric platform, more and more new BEV models will be released to market at an accelerated pace. Furthermore, the next one to three years will serve as the key timeframe for emerging automakers as well as new entrants that crossed from other industries to achieve mass production. Therefore, there remains much potential for changes to occur within the rankings of NEV automakers’ sales and market shares.

For additional insights from TrendForce analysts on the latest tech industry news, trends, and forecasts, please visit our blog at https://insider.trendforce.com/

As the pace of electrification accelerates in the global automotive market, and various governments worldwide implement subsidy policies that encourage consumer EV purchases, sales of new energy vehicles（NEV, which includes BEV/PHEV/FCV）are continuing to rise as well. NEV sales for 2021 are projected to reach 4.35 million units, a 49% increase YoY.

Due to the vast scale of the Chinese market, as well as domestic policies favorable for the growth of BEV/PHEV/FCV, various NEV brands have quickly emerged in China in recent years, such as BYD Auto, Aion（formerly GAC NE）, and BAIC BJEV. At the market’s peak, NEV manufacturers in China once numbered in the hundreds, although that number has since dwindled somewhat, as the intense competition resulted in declining sales and market shares for many automakers, including BAIC and JAC.

Four rising stars among emerging NEV manufacturers in China include NIO, XPeng, Lixian（or Li Auto）, and Weltmeister, all of which have been shipping tens of thousands of mass production vehicles each year. In particular, while NIO, XPeng, and Lixiang registered significant growths in the past few years, Weltmeister also ranked number two in terms of sales in 2019, though it fell to fourth place in 2020 as it delivered fewer vehicles compared to the top three competitors last year.

In light of the aforementioned four automakers’ current expansions, TrendForce has summarized several key aspects of their growths, including the following:

1. Autonomous Driving Technologies: Autonomous driving is not only part and parcel of these automakers’ core competencies but also a reflection of what consumers and investors expect of the automotive industry. In pursuing advanced autonomous driving technologies, the four automakers have been adopting increasingly powerful processors and computing platforms, with Nvidia being the most common partner among emerging NEV manufacturers. Remarkably, XPeng stands out as the only player making a noticeable effort to develop in-house chips.

2. LiDAR: LiDAR is integrated into an increasing number of vehicles in response to the growing demand for advanced self-driving functionalities. Although LiDAR remains out of reach for vehicles in certain price segments, autonomous driving sensors including LiDAR are no longer limited to flagship models since new NEV models’ E/E architectures are expected to be compatible with OTA updates.

LiDAR sensor demand from NEV manufacturers has significantly increased because only by pre-installing  hardware ahead of time in their vehicles can automakers enable autonomous driving functionalities as a paid subscription service through OTA updates later on.

3. Battery-swapping: Battery-swapping are relatively attractive for the Chinese NEV industry for several reasons: First, battery-swappable vehicles are excluded from China’s NEV subsidy limits*; second, automakers can now afford to lower the retail price of vehicles by turning batteries into a subscription service; finally, it’s much convenience for driver because battery swapping is faster than battery charging.

For instance, NIO’s entire NEV lineup is compatible with both battery charging and battery swapping. NIO has been pushing its BaaS（battery as a service）and  second-gen battery swap stations since 2020. On the other hand, Weltmeister and XPeng are also making their respective battery-swapping strategies.

4. Capacity Expansion and Overseas Strategies: The aforementioned four automakers all place a heavy emphasis on both expanding their production capacities and growing their overseas market shares. Their capacity expansion efforts include building in-house production lines, acquiring other facilities, or jointly funding automotive production with OEMs/ODMs. Regarding overseas expansion, their primary destination is the European market, which is relatively favorable to NEVs.

For instance, NIO and XPeng choose Norway as their first target market in Europe. However, while the European automotive market is conducive to the growth of NEVs in terms of both policies and cultures, competition among automakers is also correspondingly intense. In addition, most European countries prefer either domestic brands or other European brands. Therefore, Chinese automakers must prioritize gaining consumer trust via establishing a trustworthy brand image.

*China’s subsidies for NEV purchases are restricted to NEVs with a retail price of CN¥300,000 and under. However, NEVs with swappable batteries do not fall under this restriction.

（Cover image source: Unsplash）

As the pace of electrification accelerates in the global automotive market, and various governments worldwide implement subsidy policies that encourage consumer EV purchases, sales of new energy vehicles (NEV, which includes both BEV and PHEV) are continuing to rise as well, according to TrendForce’s latest investigations. NEV sales for 2021 are projected to reach 4.35 million units, a 49% increase YoY.

TrendForce indicates that electrification, smartization, and automation are the three key determinants of the ongoing transformation taking place in the automotive industry. Guided by these three determinants, not only are the strategies, business models, and competitions of automakers transforming, but the automotive supply chain is also changing and expanding. Upstream component suppliers and downstream manufacturers alike are now operating in accordance with new paradigms.

High potential for NEV growth entices emerging competitors to enter the market

Now that the competition between traditional and emerging automakers in the NEV market is gradually intensifying, traditional automakers have begun releasing BEVs that are based on purely electric platforms rather than preexisting ICE vehicles. However, for the vast majority of mainstream automakers, NEV sales account for less than 10% of their total car sales. These automakers are therefore placing a top priority on expanding the lineup and sales volume of their NEV models. Emerging automakers, on the other hand, are instead focusing on expanding their production capacities, and Tesla as well as Chinese brands (including NIO and XPeng) have made their respective capacity expansion plans.

NEV sales currently account for only 5% of total automotive sales. As such, not only does the NEV market still have high potential for growth, but this potential has also attracted new players, which are mostly consumer electronics and IoT vendors such as Xiaomi and OPPO, to enter the market. Given their lack of competencies in developing and manufacturing whole vehicles, these companies are instead acquiring existing automakers or utilizing ODM services. Therefore, automotive ODM services are likely to ramp up going forward, while automakers and ODMs will continue building factories via joint ventures, sharing their technologies, and jointly developing NEV models.

As software and hardware technologies improve in the automotive industry, cars now have an increasing number of smart features in response to the demand for user friendliness; for instance, the Car2Home ecosystem was created as a natural extension of V2X (vehicle-to-everything) technology. Advances in automotive systems and technologies, however, do little to assuage prospective car buyers’ fears of instant depreciation and maintenance fees, which are both justified and frequently parroted by existing owners.

Recent years, however, have seen the emergence of a new technology known as OTA (over-the-air) that can at least address car buyers’ maintenance-related worries. Automakers can fix software issues in the car with OTA updates, thus saving the driver the time and effort it takes to perform a factory maintenance. Simply put, OTA is a cloud-based service that allows automakers to perform a host of actions, including software/firmware updates, OS upgrade, issue fixing, and security patches, through a cloud-network-car connection.

As such, OTA technologies are highly dependent on data encryption, decryption, and transmission, meaning OTA services involve not only software and cloud services vendors, but also cybersecurity companies as well. According to TrendForce’s investigations, about 72% of new cars sold in 2025 will be OTA-enabled vehicles thanks to advancements in V2X, automotive electronic/electrical architectures, and intra-vehicle communications.

OTA pioneer Tesla kicked off its OTA strategies in 2012

Tesla is perhaps the impetus responsible for the surge in OTA viability in the automotive industry. Elon Musk believes that cars should be appreciated, as opposed to depreciating, assets for the consumer. As part of that belief, all Tesla models are capable of OTA updates of software and firmware, reflected in Tesla’s revenues from “service and other”, which saw yearly growths from 2016 to 2020 (Tesla’s 2020 earnings from “service and other” alone surpassed US$2.4 billion). Therefore, Tesla’s sales volume will remain the key to the market size and penetration rate of OTA technology.

Other automakers, such as BMW, Mercedes-Benz, GM, Ford, Toyota, and Volkswagen, also began rolling out OTA updates in their models from 2015 to 2020, although it wasn’t until the year 2020 did most of these companies perform OTA updates on any appreciable scale. Furthermore, most OTA updates were software updates as opposed to firmware updates (for ADAS and powertrain functionalities), since issuing firmware OTA updates still remains a major issue for automakers at the moment.

TrendForce also indicates that, should automakers wish to improve automotive functionalities with OTA updates, they would need to completely overhaul their cars’ electronic and electrical architectures. In this light, one of the prerequisites of performing functional OTA updates is the availability of compatible hardware in cars.

For instance, in order to activate LiDAR functionality, automakers must first equip a car with LiDAR hardware. Once self-driving technology matures to the point when it is deemed appropriate to be enabled on a given car, then automakers can activate the necessary LiDAR functionality with OTA updates.

Of course, all of this hinges on whether automakers are willing to bear the cost of preemptively equipping their cars with the necessary hardware, as well as whether they have any faith in the success of new services/functions to be activated by OTA in the future. Most importantly, however, if consumers were uninterested in these services and functions, then automakers would have no way of recouping their preemptive investments in the aforementioned hardware.

On the whole, despite most automakers’ planned to roll out the capability of OTA updates to their vehicles, they still face bottlenecks in performing OTA updates safely and providing useful upgrades for users. Only by overcoming these hurdles will automakers effectively improve the driving experience and convince car owners as well as prospective buyers that OTA is a worthy investment.

（Cover imgae source: Pixabay）