Government initiatives and private companies are boosting power electronics market opportunities, enabling Chinese players to compete internationally.
Driven by government policy and private companies, Chinese power electronics are promising.
In 2014, almost 40% of power semiconductor devices, including FETs, IGBT, Thyristors, Rectifiers and Diodes, were shipped in China, representing a $6B market. There is no doubt that today’s China represents one of the most important markets for power electronics.
As for its macro-economy, the Chinese government plays an important role in directing the power electronics market. For example, because of serious pollution problems the Chinese government has established a comprehensive policy framework in terms of research, technology innovation, finance, and tax incentives to support the development of a New Energy Vehicle (NEV) industry. Many white papers have been released and different subsidies and tax cuts are available to promote the market.
Government support drove strong growth in the Chinese NEV market in 2014, mainly Battery Electric Vehicles (BEV) and Plug-in Hybrid Electric Vehicles (PHEV). 75000 NEVs were sold in China, nearly three times 2013’s figure. In 2015, NEV sales continue to explode – in the first six months they surpassed the total sales for 2014. Numerous local suppliers are developing NEVs, including both private and state-owned companies, such as BYD, BAIC, CHERY, SAIC and JAC. Foreign brands including Tesla and Volkswagen are also competing in this market. The rapid growth of the NEV market translates to an explosion in the inverter market, growing sixfold from 2014 to 2020 to reach $596M.
Government policy and private companies are strong drivers. The report analyses their impact in various applications, including NEVs, photovoltaics (PV), wind turbines, transmission and distribution, rail traction, Uninterruptible Power Supplies (UPS) and motor drives.
Chinese players are increasingly competing internationally
The Chinese power electronics market used to be dominated by foreign players. That situation is rapidly changing. Local players with different business models are emerging in different sectors, challenging the established ones, not only in China but also internationally.
For example, in ten years the Chinese railway industry has evolved from an importer to a net exporter. The recent government-directed merger of CSR and CNR created a new state-owned rail giant CRRC, which is bigger than Siemens, Alstom and Bombardier together. Beside its dominating position in China, CRRC has already begun to compete with its former teachers by offering cheaper solutions as it is the case of Boston’s subway contract.
In a more liberal market, such as PV, the current market leader in China – Sungrow – is also famous outside of China. Newcomers like Huawei – a global information and communication technology (ICT) solutions provider – have brought new business concepts and are likely to challenge Sungrow’s leading position in China and become known worldwide, as they have done in ICT.
The Chinese power electronics market is going through a rapidly changing period. In this unsettled market, all companies – both foreign and local – need to find their own position. The report gives a detailed description of the power electronics environment and value chain in China.
China is investing in power semiconductors, aiming to catch up with more developed countries.
Local players in China are making progress at the end application and inverter levels. Some of them are capable of competing with established players in the international market. However, when moving down to the power semiconductor level, the technology gap between Chinese players and established players grows. For example, China still imports more than 95% of the IGBTs it uses.
In this context, China is investing to catch up with developed countries. Several recent news items, such as the opening of CSR Times Electric’s 8-inch IGBT wafer and module production base and the 6500V/200A IGBT module co-developed by Yongji and ASMC, show China’s progress in power semiconductors.
Besides investing in silicon-based semiconductors, the Chinese government also gave significant funding to Wide Band Gap (WBG) semiconductor development and industrialization. The number of companies involved in the WBG area has grown continually since 2006. Chinese companies cover the entire value chain from WBG material to applications, both for Gallium Nitride (GaN) and Silicon Carbide (SiC).
As in other countries, different factors contribute to market dynamics and influence the market adoption of WBG power devices and therefore the WBG industry China is targeting to have a strong position for next generation devices.
Objectives of the Report
- To answer the question of whether China’s economic slowdown has an impact on the power electronics market
- To identify the key drivers that will shape the Chinese power electronics market
- To describe the different market sectors in detail
- To give an overview of the industrial landscape, local and foreign suppliers
- To understand the market dynamics for related power electronics applications
- To provide a market projection for the inverter market in different segments in China up to 2020.