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Power semiconductors belong to the field of pan-analog circuits. Power semiconductors are necessary consumer goods. People need to eat "firewood, rice, oil and salt". Machines also need to consume power devices. Power semiconductors are needed in any place related to electric energy conversion. Industry fluctuations are in line with the trend of commodities, and products are closely related to global GDP trends. Industry fluctuations in 4-5 years are very consistent with the semiconductor cycle.

Increased silicon content in single machines drives industry development, and higher efficiency and better cost performance drive technological development. Demand comes from all walks of life, and the increase in the semiconductor (silicon) content of a single machine is the core rule. All technological progress points to, 1) higher power 2) smaller size 3) lower loss 4) better cost performance. The mainstream manufacturers participating in the competition are all IDM models, 1) Quality under the premise of scale 2) Efficiency improvement under the condition of optimizing the cost of each product every year.

Breakthroughs in materials have brought the industry to deeper development. Product form has developed from single diodes and MOS tubes to integrated IGBTs, and from silicon substrates to wide bandgap semiconductor substrates. The wider bandgap makes the product performance and efficiency far better than that of silicon substrate power devices, but currently it is not very advantageous in terms of cost performance. Future Trends As the cost of compound semiconductor manufacturing decreases, it is just around the corner to replace silicon-based power semiconductor devices with their advantages.

High value-added products have long been monopolized by European and American manufacturers, and domestic substitution is imminent. There are very few domestic IDM model factories. The core processes are all in-house by European and American manufacturers. They rely on their product advantages to control the delivery cycle and thus control the price system of the entire industry. Especially for high-voltage MOS and high-power IGBT, the product delivery cycle is often more than 50 weeks, and prices have basically been on an upward trajectory since 2016.

The IDM model has more advantages and fabless expands more rapidly. Investment opportunities in 2020 will come from the 3-4 year macro cycle environment where the semiconductor cycle is recovering and rising. IDM model companies have more advantages on the cost side than fabless. It is recommended to pay attention to related industry chain targets: Wingtech Technology (600745), Jiejie Microelectronics (300623), Yangjie Technology (300373), Taiji Technology (300046), China Microelectronics (600360), Star Semiconductor (603290), New Energy Saving (A18105), China Resources Microelectronics (A19303).

Risk warning

1) The progress of domestically produced chips is lower than expected;

2) Policy support for the integrated circuit industry has weakened;

3) Foreign semiconductor equipment companies embargo equipment to domestic companies.

Semiconductor power devices refer to basic circuit components with a single function, mainly realizing the processing and conversion of electrical energy.

The diode has a simple structure, but it can only be used for rectification and cannot be controlled to turn on or off. Current control switching devices such as power transistors and thyristors. MOSFET and IGBT are voltage-controlled switching devices, which are easy to drive, fast switching speed, and low loss.

Power semiconductors are the core of power conversion and circuit control in electronic devices. They are mainly used to change voltage and frequency, DC to AC conversion, etc. in electronic devices. Power devices are used in any circuit system with current, voltage and phase conversion. The main function of MOSFET and IGBT is to convert the "coarse electricity" with messy voltages and frequencies generated by power generation equipment through a series of conversion modulation into "fine electricity" with specific electric energy parameters and power terminals with varying supply and demand. They are one of the core components of electronic power changing devices.

In the development process of discrete devices, in the 1950s, power diodes and power transistors were introduced and used in industrial and power systems.

From the 1960s to the 1970s, semiconductor power devices such as thyristors developed rapidly.

In the late 1970s, planar power MOSFETs were developed;

In the late 1980s, trench power MOSFETs and IGBTs gradually became available, and semiconductor power devices officially entered the era of electronic applications.

In the 1990s, superjunction MOSFETs gradually appeared, breaking the traditional "silicon limitations" to meet the needs of high-power and high-frequency applications.

In 2008, Infineon took the lead in launching the shielded gate power MOSFET, further improving the performance of semiconductor power devices.

For the domestic market, most discrete device products such as power diodes, power triodes, and thyristors have been domestically produced. However, discrete device products such as MOSFETs and IGBTs still rely on imports to a large extent due to their advanced technology and processes. There is huge room for import substitution in the future.

In recent years, the application fields of power semiconductors have expanded from industrial control and consumer electronics to new energy, rail transit, smart grids, frequency conversion home appliances and many other markets, and the market size has shown steady growth. According to IHS Markit's forecast, the global power device market size in 2018 was approximately US$39.1 billion, and the market size is expected to grow to US$44.1 billion by 2021, with an annual growth rate of 4.1%.

At present, the domestic power semiconductor industry chain is becoming increasingly perfect, and technology is also making breakthroughs. At the same time, China is also the world's largest consumer of power semiconductors. In 2018, the market demand reached US$13.8 billion, with a growth rate of 9.5%, accounting for 35% of global demand. It is expected that China's power semiconductors will continue to maintain a high growth rate in the future, with the market size expected to reach US$15.9 billion in 2021, with an annual growth rate of 4.8%.

Market research organization IC Insights pointed out that among various types of semiconductor power device components, the products with the strongest growth in the future will be MOSFET and IGBT modules.

MOSFET is a field effect transistor that can be widely used in analog circuits and digital circuits. It has the advantages of small on-resistance, low loss, simple drive circuit, and good thermal resistance characteristics. It is especially suitable for use in power control fields such as computers, mobile phones, mobile power supplies, vehicle navigation, electric vehicles, and UPS power supplies.

In 2016, the global MOSFET market reached US$6.2 billion, and the compound annual growth rate of the MOSFET market is expected to reach 3.4% from 2016 to 2022; it is expected that by 2022, the global MOSFET market will be close to US$7.5 billion.

According to statistics from IHSMarkit, my country's MOSFET market size was US$2.792 billion in 2018, with a compound annual growth rate of 15.03% from 2016 to 2018. As the scale of global new energy vehicles grows, the market demand for MOSFETs in automotive applications is expected to grow rapidly at a compound annual growth rate of 5.1% from 2016 to 2022; by 2022, its demand in automotive applications will surpass the computer and data storage fields, accounting for 22% of the overall demand market.

IGBT is a composite fully controlled voltage-driven semiconductor power device composed of a bipolar triode (BJT) and a MOSFET. It has the advantages of both the high input impedance of the MOSFET and the low conduction voltage drop of the bipolar triode (BJT). The IGBT drive power is small and the saturation voltage is reduced. It is very suitable for use in converter systems with a DC voltage of 600V and above, such as AC motors, inverters, switching power supplies, lighting circuits, traction drives, etc.

According to data from the China Industry Information Network, the global IGBT single-tube market space will reach approximately US$6 billion by 2020, which is a huge market space. It is expected that my country's new energy vehicle and charging pile market will drive domestic market demand for IGBT modules worth 20 billion yuan in the next five years. According to data from the China Industry Information Network, the domestic IGBT market size reached 16.19 billion yuan by 2018, with a compound growth rate of 14.77% from 2010 to 2018; however, my country's IGBT started late, and there is huge room for import substitution in the future.

Semiconductor power devices mainly include power diodes, power transistors, thyristors, MOSFETs, IGBTs, etc., which are used in almost all electronic manufacturing industries, including computers, network communications, consumer electronics, automotive electronics, industrial electronics and other electronic industries. In addition, emerging application fields such as new energy vehicles/charging piles, smart equipment manufacturing, the Internet of Things, and photovoltaic new energy have gradually become important application markets for semiconductor power devices, thus driving their demand growth. In the global power semiconductor market, industrial control accounts for 34%, automobiles 23%, consumer electronics 20%, and communications 23%.

According to statistics from the Consumer Electronics Association, the overall size of China's consumer electronics market reached 1,632.5 billion yuan in 2013, becoming the world's largest consumer electronics market. According to the 2017 3C Industry Report, China's consumer electronics market will exceed 2 trillion yuan in 2017, with an expected growth of 7.1%.

ESD protection is required for all interfaces on the mobile phone, such as microphones, earpieces, headphones, speakers, SIM cards, Micro SD, NFC antennas, GPS antennas, WiFi antennas, touch screens, 2G/3G/4G RF antennas, USB interfaces, lithium batteries, and power button positions. The most mobile phones use more than 20, and the few use more than 10.

As people's requirements for charging efficiency gradually increase, a "fast charging" mode has emerged for mobile phone charging, which achieves high-current and high-power charging by increasing the voltage. However, high voltage has safety hazards and requires the addition of synchronous rectification MOS tubes for adjustment;

Later, a safer "flash charge" mode appeared, which achieves high-speed charging through low voltage and high current. This has higher requirements for synchronous rectification MOS transistors. Currently, the more common one is GaN FET, which can achieve the purpose of less heat and small size.

Automotive electronics occupies a very important position in automobiles. From the perspective of cost structure, it is more important for mid-to-high-end automobiles, electric vehicles, etc.

From traditional cars to new energy cars, the biggest increase in value is power semiconductors. In traditional fuel vehicles, power semiconductors are mainly used in the fields of starting, stopping and safety, accounting for only 20%. According to the value of a semiconductor bicycle in a traditional vehicle, it is worth US$350, and the value of power devices is US$70. The battery power module of new energy vehicles requires a large amount of power equipment, which all contain power semiconductors. The power devices of hybrid vehicles account for 40%, and the power devices of pure electric vehicles account for 55%. Based on the value of a pure electric vehicle semiconductor bicycle of US$750, the value of a power semiconductor bicycle is US$413. The power semiconductors used in new energy vehicles are seven times that of traditional vehicles.

Since new energy vehicles no longer require mechanical components such as engines, the structure of the car will become very simple. The structure of the car is mainly composed of batteries, motors and electronic controls. New energy vehicle electronic systems mainly include battery management systems, motor controllers, on-board chargers, converters, inverters, steering systems, relays and passive components.

In actual application scenarios, since each module of the car uses alternating current, the input current of the lithium battery is direct current, and the voltages of various electrical equipment are different, this requires a corresponding power conversion system. According to the different conversion sequences of direct current (DC) and alternating current (AC), power conversion is divided into 4 modes: transformer (AC-AC), rectifier (AC-DC), converter (DC-DC) and inverter (DC-AC).

Transformer (AC-AC): The input voltage of a car lithium battery is between 12V-36V, and the civilian voltage is 220V. A transformer is needed to convert the civilian voltage into the input voltage.

Rectifier (AC-DC): Lithium batteries need to be charged with direct current (DC) power, and the charging pile provides alternating current (AC) power, so the car charger must use a DC converter.

Converter (DC-DC): The input is a fixed direct current (DC) voltage from the lithium battery, and the output is a variable direct current (DC) voltage. In electric vehicles, it is mainly used in the step-up conversion from 300V to 650V for electric power transmission, the step-down conversion for powering 12V circuits, and the voltage stabilization conversion for battery energy storage.

Inverter (DC-AC): New energy vehicles are equipped with rechargeable lithium batteries, which use the stored electric energy to drive the motor to power the vehicle. The function of the inverter is to convert the 12V direct current (DC) power of the rechargeable battery into the 220V three-phase alternating current (AC) power of the drive motor, providing the basic driving force for new energy vehicles.

From 2014 to 2021, global annual sales of fuel vehicles increased from more than 87 million units to more than 98 million units, with an average annual growth rate of 2%; new energy vehicles (including pure electric and hybrid vehicles) increased from 270,000 units to 4.7 million units, with an average annual growth rate of 50%. Their penetration rate increased from only 0.3% in 2014 to 4.0% in 2021.

In recent years, the production and sales of new energy vehicles in my country have increased significantly, and the penetration rate has continued to increase. According to data from the China Passenger Car Association, sales of new energy passenger vehicles in my country increased rapidly from 100,000 units in 2014 to 1.25 million units in 2018, with a compound annual growth rate of 91%. According to data from the China Association of Automobile Manufacturers, China's new energy vehicle sales in the first quarter of 2019 were 250,000 units, a year-on-year increase of more than 117%. It is expected that new energy vehicle production this year may exceed 1.6 million units.

The automotive power semiconductor market is expected to reach US$8 billion, with a compound annual growth rate of 7%. In 2018, global car sales were 97.5 million, including 2 million new energy vehicles. Assuming that the sales of traditional fuel vehicles will increase by 2% annually and the sales of new energy vehicles will increase by 30% in the next three years, the power semiconductor bicycle of traditional fuel vehicles is worth US$56, the power semiconductor bicycle of hybrid vehicles is worth US$240, and the power semiconductor bicycle of pure electric vehicles is worth US$413. It can be predicted that by 2022, the sales volume of fuel vehicles will be 99.2 million units, and the sales volume of new energy vehicles will be 5.8 million units. The automotive power semiconductor market is expected to reach US$8 billion, with a compound annual growth rate of 7%.

As of the end of 2017, my country's newly installed photovoltaic power generation capacity was 53.06 million kilowatts, with a cumulative installed capacity of 130 million kilowatts. Both new and cumulative installed capacity ranked first in the world, including 33.62 million kilowatts of photovoltaic power stations, an increase of 11% year-on-year; and 19.44 million kilowatts of distributed photovoltaics, an increase of 3.7 times year-on-year.

The inverter equipment of wind power generation can convert the DC12V direct current in the battery into the AC220V alternating current which is the same as the mains power. The inverter is mainly composed of MOS field effect tube and power transformer as the core, and is connected through analog circuit technology. From 2016 to 2018, my country's wind power installed capacity increased from 18.73GW to 21GW. In the first five months of 2019 alone, the installed capacity increased by 6.88GW, showing a rapid growth trend.

In all aspects of the smart grid, rectifiers, inverters and FACTS flexible transmission technology in UHV DC transmission require a large number of power devices such as IGBTs. According to data released by China Industry Information Network, it is expected that the investment scale of my country's smart grid industry will reach nearly 2.3 trillion yuan by 2021.

There are many types of power semiconductors, which are widely used in consumer electronics, high-speed rail, automobiles, and power grids. Mainly divided into unipolar and bipolar types. Bipolar type: power diode, thyristor, BJT (bipolar triode), power transistor (GTR), IGBT. Unipolar type: MOSFET, Schottky diode. According to the different physical properties of each segmented product, different power devices are used in different voltage and frequency areas.

Power diodes are basic power devices with simple structure and high reliability. They are widely used in various fields such as industry and electronics, and play the roles of voltage stabilization, rectification and switching.

Diodes are divided into rectifier diodes, Zener diodes and high frequency diodes.

Among them, rectifier diodes and Zener diodes are power semiconductors.

Rectifier diodes are mainly used for rectification, switching, conversion (Schottky diode SBD) and inversion (fast recovery diode FRD).

MOSFET is a subdivision of power devices, namely MOS (Metal Oxide Semiconductor) and FET (Field Effect Transistor), which are field effect transistors that use the gate of the metal layer (M) across the oxide layer (O) to control the semiconductor (S) by using the effect of the electric field.

Power MOSFET devices are core semiconductor devices for power conversion and control. Power MOSFET devices work quickly, have low failure rates, small switching losses, and good scalability. It is suitable for low voltage and high current environments and requires higher operating frequency than other power devices.

In automobiles, they are mainly used in chargers (AC-DC) and converters (DC-DC) in the power supply system. The global automotive power MOSFET market capacity was US$2.45 billion in 2018, and we estimate that the market capacity will be US$3.16 billion in 2022. Among them, high-voltage MOSFET products with voltages above 600V are mainly used.

The main share of the MOSFET market is occupied by Infineon. According to HIS data, the comprehensive market share of all Infineon products is 27%, followed by ON Semiconductor with 13% and Renesas with 9%. In the field of high-value high-voltage MOSFETs, Infineon leads all competitors with a market share of 36%.

As a new type of power electronic device, IGBT is internationally recognized as the most representative product of the third revolution of power electronics technology. It is a core component in the field of industrial control and automation. Its function is similar to the human heart. It can adjust the voltage, current, frequency, phase, etc. in the circuit according to the signal instructions in the industrial device to achieve precise control. Therefore, IGBT is called the "CPU" in the power electronics industry and is widely used in motor energy saving, rail transportation, smart grids, aerospace, household appliances, automotive electronics, new energy power generation, new energy vehicles and other fields.

IGBT has developed rapidly since its industrial application in the late 1980s. It has not only replaced MOSFET and GTR in industrial applications, but has even expanded into high-power applications where SCR and GTO are dominant. It has also replaced many application fields of power devices such as BJT and MOSFET in consumer electronics applications.

In automotive applications, IGBTs are mainly used in electric drive systems, power systems and charging piles in high-voltage environments. The application range is generally in areas with a withstand voltage of more than 600V, a current of more than 10A, and a frequency of more than 1KHz.

Electric drive system: Mainly used in an inverter (DC-AC) to convert the 12V direct current (DC) power of the rechargeable battery into the 220V alternating current (AC) power that drives the motor. It is the core of the motor drive. The motor control system requires dozens of IGBTs. For example, Tesla's three-phase AC asynchronous motor uses 28 IGBTs per phase, a total of 84. Other motors have 12 IGBTs. Tesla uses a total of 96 IGBTs.

Power supply system: Mainly used in vehicle chargers (AC-DC) and converters (DC-DC) to achieve lithium battery charging and power conversion at the required voltage level.

Charging piles: The electricity in the grid is all alternating current (AC) power, and charging piles are divided into fast-charging DC charging piles and slow-charging AC charging piles. IGBT is mainly used in DC fast-charging charging piles.

The global automotive IGBT market capacity in 2018 was US$1.84 billion, and we estimate that the automotive IGBT market capacity in 2020 will be US$2.08 billion.

Infineon, Mitsubishi and Fuji Electric are in the leading position in the global IGBT market. ON Semiconductor (Fairchild) is mainly concentrated in the low-voltage consumer electronics industry, with voltages below 600V, while medium and high-voltage fields above 1700V are mainly used in high-speed rail, automobiles, smart grids, etc., and are basically monopolized by Infineon, ABB and Mitsubishi.

Power semiconductors belong to the field of pan-analog circuits. Power semiconductors are necessary consumer goods. People need to eat "firewood, rice, oil and salt". Machines also need to consume power devices. Power semiconductors are needed in any place related to electric energy conversion. Industry fluctuations are in line with the trend of commodities, and products are closely related to global GDP trends. Industry fluctuations in 4-5 years are very consistent with the semiconductor cycle.

High value-added products have long been monopolized by European and American manufacturers, and domestic substitution is imminent. There are very few domestic IDM model factories. The core processes are all in-house by European and American manufacturers. They rely on their product advantages to control the delivery cycle and thus control the price system of the entire industry. Especially for high-voltage MOS and high-power IGBT, the product delivery cycle is often more than 50 weeks, and prices have basically been on an upward trajectory since 2016.

Investment opportunities in 2020 will come from the 3-4 year macro cycle environment where the semiconductor cycle is recovering and rising. IDM model companies have more advantages on the cost side than fabless. It is recommended to pay attention to related industry chain targets: Wingtech Technology (600745), Jiejie Microelectronics (300623), Yangjie Technology (300373), Taiji Technology (300046), China Microelectronics (600360), Star Semiconductor (603290), New Energy Saving (A18105), China Resources Microelectronics (A19303).

Risk warning

1) The progress of domestically produced chips is lower than expected;

2) Policy support for the integrated circuit industry has weakened;

3) Foreign semiconductor equipment companies embargo equipment to domestic companies.

Note: This article is reprinted from "Semiconductor Wind Vane", which supports the protection of intellectual property rights. Please indicate the original source and author of the reprint. If there is any infringement, please contact us to delete it.

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