Recently, rumors surfaced that price drops in the silicon carbide (SiC) wafer market. So, what is the actual market situation for SiC wafer?

Currently, most companies in the supply chain agree on the fact that the price of SiC wafer is on the decline. For instance, Xu Xiulan, the chairwoman of GlobalWafers, publicly stated that the global release of 6-inch SiC wafer production capacity, coupled with a temporary slowdown in demand for electric vehicles, is putting downward pressure on SiC wafer prices in 2024. On May 9, 2024, SICC highlighted two internal reasons for the price drop in an investor relations report: technological advancements and scale effect, which brought down wafer costs.

Indeed, changes in technology and production capacity of SiC wafer have become increasingly evident since 2H23.

Technically, more than ten China-base companies have entered the sample delivery and small-batch production stages for 8-inch SiC wafer in addition to international ones, including SemiSiC, JSG, SICC, GZSC, Synlight Crystal, Tankeblue, KY Semiconductor, Hunan San’an Semiconductor, Hypersics, Taisic Materials, Heligenius, Cengol Semi,and GlobalWafers.

Regarding scale effect, while SiC wafer manufacturers’ early invested projects are now reaching the investment return phase, not a few wafer companies have been shifting their production focus to 8-inch wafer.

For example, JSG’s project for an annual production of 250,000 6-inch and 50,000 8-inch SiC wafers officially signed and started in November 2023; Cengol’s 8-inch SiC processing line got ready and went into small-batch production in February 2024; GZSC’s 8-inch SiC single crystal and wafer project was established in Jinan, Shandong, in June 2023, with full production expected by 2025; KY Semiconductor signed a strategic cooperation agreement with Russian company N in March 2024 to work on the “8-inch SiC Perfect Seed Crystal” project.

The decline in SiC wafer prices is an inevitable trend, towards which most companies hold a positive attitude. As CGEE stated, the expansion of market space and improvement in yield levels will unavoidably cause price adjustments during the competition, which will place stress on related companies in the short term.

However, for the entire supply chain, the advantages from the improvement in yield and decrease in prices outbalance disadvantages. That means cost reduction will invigorate more downstream applications, and thereby enable the industry to maintain a sound growth rate as a whole.

As a part of SiC wafer market, SICC also pointed out that currently, the price of SiC wafer is much higher than that of Si wafer. As such, the decrease in SiC wafer prices will help expand downstream applications and promote the penetration and adoption of SiC technology and materials, fostering overall growth.

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• [News] Continuous Breakthroughs in SiC Substrates, Global 8-Inch Fab to Reach 11

(Photo credit: JSG)

According to a report from Wall Street Journal, Alphabet CFO Ruth Porat announced in a statement on May 30 that Google has committed to investing USD 2 billion in Malaysia. The investment includes building its first data center, expanding Google Cloud, and further developing artificial intelligence (AI).

Porat highlighted that this will be Google’s largest investment project in Malaysia. Google estimates that this investment will contribute over USD 3.2 billion to Malaysia’s GDP and create 26,500 jobs by 2030.

As per a report from Bloomberg, Google stated that in addition to developing cloud computing services, it will also support AI literacy programs for students and educators.

In its earnings call in April, Porat mentioned that the significant year-over-year increase in capital expenditures over recent quarters reflects Alphabet’s confidence in the potential of AI. She projected that the quarterly capital expenditures for the second to fourth quarters of this year would be comparable to or slightly higher than those in the first quarter.

On May 2, Microsoft Corp. announced that it will invest USD 2.2 billion in Malaysia over the next four years to support the country’s digital transformation. The investment projects include developing digital infrastructure, creating AI skill opportunities, establishing a National AI Excellence Center, and enhancing Malaysia’s cybersecurity capabilities.

Earlier this week, Malaysian Prime Minister Anwar Ibrahim announced the National Semiconductor Strategy, which includes providing at least USD 5.3 billion in financial support and training 60,000 semiconductor engineers, aiming to make Malaysia a global chip hub.

Amidst the U.S.-China rivalry and other geopolitical tensions, global companies are seeking to diversify their supply chains. Facing competition between the U.S. and China, Malaysia is reportedly keen to maintain a neutral position in the semiconductor supply chain landscape. According to the Malaysian Investment Development Authority (MIDA), the country currently provides 13% of global testing and packaging.

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• [News] Malaysia’s Major Investment Aims to Establish Global Chip Hub
• [News] Overseas Expansion of Testing and Packaging Facilities – Japan, Malaysia, and Singapore Emerge as Top Choices

(Photo credit: Google)

Intel has reportedly delayed its construction of Fab 29.1 and 29.2 in Magdeburg, Germany, as the new timeline now pushes the start of construction to May 2025, according to a report by tom’s Hardware, citing German media outlet Volksstimme.

However, the fabs could still become operational by late 2027 or early 2028 if the semiconductor giant expedites construction and tool installation, the report stated. The current scenario does seem challenging though, as the company has to deal with black soil removal issues and delays in subsidy approvals.

In June 2023, Intel reached an agreement with Germany, announcing the signing of an amended investment memorandum. The plan involves investing over EUR 30 billion to construct two new fabs in Magdeburg, of which the German federal government has agreed to provide a subsidy of EUR 10 billion, including incentives and subsidies from the European Chips Act and government initiatives.

Originally, construction was scheduled to begin in the first half of 2023 but was postponed to summer 2024 due to delays in subsidy approvals. Until recently, the EU Competition Authority has not yet approved the around EUR 10 billion subsidy.

The topsoil removal process, as required by law, thus, has been rescheduled to May 2025. In the meantime, Intel and the state are adjusting plans, focusing on infrastructure development and land acquisition to prepare for the delayed construction, according to the aforementioned reports.

Fab 29.1 and Fab 29.2 were initially planned to begin operations in late 2027, utilizing Intel’s 14A (1.4nm) and 10A (1nm) process nodes for specific products on Intel’s roadmap, the reports noted. Although Intel has some time to ramp up the fab even if it becomes ready by mid-2028, the schedule remains tight.

The report from Volksstimme even indicated that Intel now estimates it will take four to five years to build the two factories, with production potentially starting in 2029 or 2030.

On the other hand, regarding major semiconductor companies’ overseas expansion progress in Germany, in mid-May, TSMC confirmed that it will start construction of its first chip plant in Europe in Dresden, eastern Germany, in the fourth quarter of this year, with production expected to begin in 2027.

It is understood that TSMC’s fab in Germany will initially focus on the 22-nanometer process, mainly producing automotive microcontrollers. There is a possibility of expanding to produce more advanced chips in the future.

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• [News] Intel Submits Conceptual Drawings for Fab Construction in Germany, Installing High-NA EUV Exposure Machines
• [News] TSMC Confirms Construction for Its First European Chip Plant to Commence in Q4, as Scheduled

(Photo credit: Intel)

On May 30, MediaTek unveiled the Dimensity 7300 series mobile chips, including the Dimensity 7300 and Dimensity 7300X, both utilizing TSMC’s highly efficient 4nm process. The Dimensity 7300 offers exceptional energy efficiency and performance, meeting the high demands for multitasking, imaging, gaming, and AI computing in terminal devices. The Dimensity 7300X supports dual-screen displays, making it suitable for foldable devices.

The Dimensity 7300 series features an octa-core CPU with 4X Arm Cortex-A78 cores operating at 2.5GHz paired with four Cortex-A55 cores. Compared to the Dimensity 7050, the advanced 4nm Cortex-A78 cores in the Dimensity 7300 can achieve up to 25% power savings at the same performance level.

The Dimensity 7300 is equipped with a 12-bit HDR-ISP image processor, Imagiq 950, which supports up to a 200MP main camera, enabling smartphone users to capture images with outstanding color and detail. The Dimensity 7300 combines a new hardware engine that provides precise noise reduction (MCNR), hardware face detection (HWFD), and video HDR capabilities, allowing users to capture clear images in various lighting conditions.

“The MediaTek Dimensity 7300 chips will be important for integrating the latest AI enhancements and connectivity features so consumers can seamlessly stream and game,” said Dr. Yenchi Lee, Deputy General Manager of MediaTek’s Wireless Communications Business. “Furthermore, the Dimensity 7300X enables OEMs to develop innovative new form factors thanks to its dual display support.”

Compared to the Dimensity 7050, the Dimensity 7300 offers a 1.3 times improvement in live focus photo performance and a 1.5 times improvement in photo remastering. Additionally, the dynamic range for 4K HDR video recording has been enhanced by 50% compared to similar products, delivering richer image details. The Dimensity 7300 integrates the AI processor APU 655, which delivers performance that is twice that of the Dimensity 7050.

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• [News] MediaTek Partners with Ranovus to Enter Niche Market, Expands into Heterogeneous Integration Co-Packaged Optics Industry
• [News] MediaTek Lands Significant WiFi 7 Deals, Disrupting Broadcom’s Long-standing Dominance

(Photo credit: MediaTek)

According to a report from Nikkei News, Japan will require companies in critical industries such as semiconductor and machine tools to take measures to prevent cross-border technology leaks in order to receive government assistance.

The planned technology transfer rules will reportedly apply to five sectors: semiconductors, advanced electronic components, batteries, aircraft components, and machine tools and industrial robots.

The Ministry of Economy, Trade, and Industry (METI) will issue revised guidance regarding these sectors, which are part of the 12 critical materials designated by Japan under the Economic Security Act of 2022. This move aims to maintain Japan’s international competitiveness in advanced technology fields such as chip manufacturing materials and carbon fiber used in aircraft.

Companies applying for subsidies will first need to declare the “core technologies” they need protection for. The protective clauses of the METI will include measures to minimize the number of personnel involved in critical materials and require relevant staff to sign contracts committing not to take sensitive technology with them when they leave the company.

For companies that share technology with business partners, all parties must sign confidentiality agreements. They must also restrict the number of personnel involved in critical technology and monitor these employees.

For enterprises seeking to manufacture overseas or expand production of critical technology, they must consult with the METI in advance. This regulation is also aimed at avoiding dependence on such technology imports.

If a company producing advanced semiconductors wishes to increase overseas production by 5% or more, it must notify the ministry. For traditional semiconductors, increasing overseas production by more than 10% will trigger this requirement. Beneficiaries who violate the protective clauses may be required to repay subsidies.

Besides Japan, the US Department of Commerce also released details regarding its CHIPS and Science Act, which stipulates that beneficiaries of the act will be restricted in their investment activities—for more advanced and mature processes—in China, North Korea, Iran, and Russia for the next ten years.

The scope of restrictions in this updated legislation will be far more extensive than the previous export ban, further reducing the willingness of multinational semiconductor companies to invest in China for the next decade.

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• [News] Strengthening Controls on Semiconductor Equipment Exports to China, Japan Reportedly Tightens Export Control Measures Further
• [News] A Subsidy Wave Sweeping in the US, Europe and Japan amid the Cut-Throat Chip Competition