SK Siltron’s Foundry Play: Boosting SiC Supply for the EV Revolution

Seoul, South Korea – SK Siltron, a leading global silicon wafer manufacturer and subsidiary of SK Group, is making a strategic move to capitalize on the surging demand for silicon carbide (SiC) power semiconductors. The company’s recent acquisition of SK Powertech and subsequent plans to launch a dedicated SiC foundry business are poised to significantly impact the supply chain for electric vehicles (EVs) and industrial power applications.

SiC is rapidly becoming a critical material in modern power electronics, offering superior efficiency and power density compared to traditional silicon-based devices. This makes it ideal for applications such as EV powertrains, onboard chargers, and industrial motor drives. However, securing a reliable and scalable supply of SiC remains a major challenge for the industry. SK Siltron’s move is a direct response to this growing need.

Addressing the Supply Chain Bottleneck

For years, the SiC supply chain has been characterized by limited capacity and concentrated production. A handful of vertically integrated companies dominate the market, leading to potential bottlenecks and price volatility. “The industry has been anticipating more diversity in the SiC supply chain for quite some time,” stated one industry analyst, speaking on condition of anonymity. “SK Siltron’s entry as a dedicated foundry could be a game-changer.”

SK Siltron’s strategy focuses on becoming a key manufacturing partner for fabless SiC companies, providing them with access to advanced fabrication capabilities. “We see a strong opportunity to serve the growing demand for SiC devices by offering a reliable and scalable foundry service,” explained a company spokesperson. “Our expertise in wafer manufacturing, combined with SK Powertech’s SiC technology, will enable us to deliver high-quality products to our customers.”

Leveraging 8-inch Wafers for Cost Reduction

A key element of SK Siltron’s strategy is its commitment to 8-inch SiC wafers. While 6-inch wafers have been the dominant format for SiC production, the industry is increasingly transitioning to the larger 8-inch size. This shift offers significant cost advantages, as more chips can be produced per wafer, leading to lower manufacturing costs and increased efficiency.

“The move to 8-inch wafers is crucial for scaling up SiC production and reducing costs,” noted another industry expert. “SK Siltron’s focus on 8-inch manufacturing puts them in a strong position to meet the future demands of the market.” The company plans to launch its 8-inch SiC foundry business in the first half of 2026, with process technology available by late 2025, aligning with the expected ramp-up of 8-inch SiC production.

A Boost for Fabless SiC Innovators

While vertically integrated players like Wolfspeed, STMicroelectronics, and Infineon control a large portion of the SiC market, a growing number of fabless semiconductor companies are designing innovative SiC-based power solutions. These companies often rely on outsourced manufacturing, creating a demand for dedicated SiC foundries.

“There’s a significant opportunity for pure-play SiC foundries to serve the needs of these fabless companies,” said a representative from a SiC design house. “SK Siltron’s entry into the market will provide much-needed manufacturing capacity and support innovation in the SiC space.” By offering a dedicated foundry service, SK Siltron can enable more companies to bring their SiC-based products to market, fostering competition and driving down costs.

SK Powertech: The Technology Backbone

The acquisition of SK Powertech played a critical role in SK Siltron’s strategy. SK Powertech had established itself as a specialist in SiC power device commercialization, possessing core process technologies and expertise in SiC material processing. While the specifics of their previous commercial success are not widely publicized, SK Siltron clearly identified their technological capabilities as vital for accelerating their entry into the SiC foundry market.

“SK Powertech brought valuable intellectual property and process know-how to the table,” explained a source familiar with the acquisition. “This allowed SK Siltron to bypass years of internal development and quickly establish a competitive SiC manufacturing platform.”

Competition and Challenges Ahead

While SK Siltron’s move is poised to benefit the SiC supply chain, the company faces significant competition. Established IDMs with internal SiC manufacturing capabilities will continue to dominate the market. Furthermore, new entrants, such as Chinese vendors like TanKeBlue and SICC, are rapidly expanding their SiC substrate and manufacturing capacity.

“The SiC market is becoming increasingly crowded,” cautioned a market research analyst. “SK Siltron will need to differentiate itself by offering superior quality, advanced technology, and competitive pricing to succeed.”

The company will also need to secure a reliable supply of high-purity SiC substrates, as demand for these materials is expected to surge with the growth of SiC manufacturing. While substrate manufacturers are expanding production, maintaining a stable and cost-effective supply chain will be crucial for SK Siltron.

Impact on the EV and Industrial Sectors

SK Siltron’s investment in SiC manufacturing is expected to have a positive impact on both the electric vehicle and industrial sectors. By increasing the supply of SiC devices, the company can help reduce the cost and improve the performance of EV powertrains, onboard chargers, and inverters.

“A more robust and diversified SiC supply chain will be essential for supporting the continued growth of the EV market,” stated a representative from an EV manufacturer. “SK Siltron’s investment is a welcome development.”

In the industrial sector, SiC devices are playing an increasingly important role in applications such as motor drives, renewable energy inverters, and energy storage systems. By providing a reliable supply of SiC components, SK Siltron can help enable higher efficiency and improved reliability in these applications, contributing to a more sustainable future.

While short-term market dynamics might be influenced by factors like temporary slowdowns in EV shipments, the long-term outlook for SiC remains exceptionally strong. SK Siltron’s commitment to expanding SiC manufacturing capacity positions the company as a key player in shaping the future of power electronics.