Silicon carbide scramble started: Tianyue advanced IPO was sought after "Ning Wang" appeared on the battle list with many car companies

"Science and Technology Innovation Board Daily" (editor, Zheng Yuanfang), on the evening of the 6th, Tianyue Advanced disclosed the results of the IPO strategic investor payment subscription, of which SAIC Group was allocated 49.7512 million yuan, and Guangdong Xiaopeng Automobile Technology was allocated 49.7512 million yuan. In addition, GAC Group and CATL participated in the IPO through their subsidiaries - Guangqiqiqi and Wending Investment.

Tianyue Advanced's ability to win such a luxurious lineup of war shots is closely related to the track the company is on. Its main products are the third generation of semiconductor silicon carbide (SiC) substrate materials, the main products include different sizes of semi-insulated and conductive SiC substrates. Among them, semi-insulated products are mainly used in information and communications and other fields, and one of the main application areas of conductive substrates is new energy vehicles.

At present, semi-insulated SiC substrates are the company's main source of income, but the IPO projects of the science and technology innovation board are concentrated on the expansion of 6-inch conductive substrates.

It is worth mentioning that recently another SiC substrate manufacturer, Tongguang Shares, has also received investment from car companies. As the leading investor, Great Wall Motors invested in Tongguang Shares, focusing on the application of SiC in the new energy automobile industry. Tongguang Co., Ltd.'s first expansion project, laiyuan plant, was put into operation last year; at the same time, the company is also planning to continue to promote production expansion, and it is expected that the annual production capacity of SiC monocrystalline substrates will reach 600,000 pieces.

What is the logic of car companies competing for silicon carbide?

According to the data given by Tianfeng Securities, compared with silicon (Si) materials, the energy savings after using SiC are equivalent to: 1) saving 5.5 barrels of oil per car per year; 2) reducing CO2 emissions by 690kg per year. Chen Dongpo, deputy general manager of Sanan Optoelectronics, expects that in 2023-2024, basically 80-90% or even 100% of long-range models will import SiC devices.

In November last year, SiC chip company Zhanxin Electronics announced the completion of A+ and A++ rounds of financing with a total amount of hundreds of millions of yuan, and among the participants, GAC Capital and CATL era appeared.

In the same month, the Xiaopeng G9 was officially released, becoming the first mass production car based on the 800V SiC platform in China; and the first model of Great Wall Sharon Automobile, the Mech Dragon, also expressed support for 800V super fast charging; SAIC Volkswagen has also completed the "three-in-one" bridge trial production, which can effectively improve the vehicle's mileage, and will be installed on the ID.4 X model in the future.

It is worth mentioning that the previous cost of SiC was higher than Si has always been criticized by the outside world. However, now that the cost of SiC has been gradually reduced, Anxin Securities pointed out that the cost reduction effect brought by the improvement of SiC efficiency to the whole vehicle can offset the increase in the cost of the device itself, and the use of SiC devices will not increase the cost of the vehicle.

On the other hand, unlike traditional Si materials, the cost of SiC substrate materials accounts for nearly 50% of the total cost. For example, the total cost of a SiC 6-inch wafer is about 6400 yuan, of which the substrate + epitaxial value is about 3840 yuan.

At the same time, due to the high supply chain, technology and patent barriers, Gong Ruijiao, a compound semiconductor analyst at Jibang Consulting, also pointed out a few days ago that the substrate is a key constraint on the production capacity of SiC wafers, and the future acquisition of SiC substrate resources will become the entrance ticket to the next generation of electric vehicle power devices.