Capturing New Market
As interest in environmentally-friendly energy and energy savings are hiking, power semiconductors are considered to be new growth drivers. However, since Korean companies cannot quite reach the global level yet, strategic nourishment for predominating an environmentally-friendly market is crucial.
According to Yano Economic Research Institute, a Japanese market research company, the global power semiconductor market, which was US$14.313 billion in size last year, will become US$29.45 billion by 2020, as demands for white goods, automobiles, and industrial machinery will start increasing in 2015. The average growth rate is 10.9 percent per year.
Power semiconductors are primarily used in inverter or converter circuits, and efficiently control energy consumption by monitoring power conversion and motor controls. Whereas IT devices like PCs and mobiles, which consume a substantial amount of power per unit area, have been the main demands for power semiconductors so far, the market will expand to white goods, industrial machinery, and automobiles.
Yano Economic Research Institute is particularly focusing on the growth momentum of next-generation power semiconductors as demand grows for the power control of big machinery such as industrial usages and automobile. These next-gen power semiconductors utilize new materials such as silicon carbide (SiC) and gallium nitride (GaN) because they have less consumption, high speed switching, and high thermal resistance. Last year, the market size of new power semiconductors was only US$90 million, but it will continue to grow almost double every year, reaching US$2.82 billion by 2020, according to the institute’s projections.
Although the size of the power semiconductor market in Korea is almost US$1.7 billion, supply is highly dependent on exports due to a lack of domestic suppliers.
According to market research company HIS Technology, only three Korean companies -- Silicon Mitus, KEC and MagnaChip – were listed at 40th, 49th, and 53rd, respectively, on the industry sales ranking of the world’s power semiconductor design company Fabless. The market share of all three companies together is less than 1 percent. The number one company is Texas Instruments (24.1 percent, U.S.), and other American companies including Analog Devices (10.4 percent, U.S.) and Maxim Integrated (8.5 percent, U.S.) are leading the market. Samsung Electronics, SK Hynix, and Silicon Works are important in the power semiconductors market. On the other hand, Dongbu HiTek recently developed the process technology for manufacturing a 0.13 micron compound voltage element power semiconductor for smartphones, and announced its plan to increase sales up to 35 percent of the total sales volume.