Infineon Technologies Invests in Next-Generation Power Semiconductors for Various Applications from Ultra-Fast Mobile Chargers to Electric Vehicles.

European chip manufacturer Infineon is betting on the next generation of power semiconductors, aimed at various fields from ultra-fast mobile phone chargers to electric cars, in order to stimulate growth in a broader chip market downturn. Infineon's goal is to develop advanced materials with higher capacity and efficiency than traditional silicon-based power chips.

The company's head of power and sensor systems, Adam White, told Nikkei Asia that Infineon is particularly bullish on gallium nitride (GaN) chips. "Our goal is to become a leader in the chip industry for power systems," White said. "We see the tipping point for gallium nitride happening in real time."

The company predicts that the gallium nitride chip market will grow at an annual rate of 56% by 2027. According to White, Infineon recently disclosed an $830 million deal to acquire Ottawa chip design company GaN Systems, expanding its product portfolio and "strengthening its leadership position in the power system field." White told Nikkei Asia that the deal is pending regulatory approval, which will increase its research and development team focused on gallium nitride chips to more than 450 people and expand its global customer base to 2,000.

Power chips built on gallium nitride are more energy-efficient and can compress the same capacity into a smaller space compared to chips built on conventional silicon wafers. This means that chargers and adapters can also be made smaller. For example, the current output power of the iPhone 14 adapter is 20 watts, but using gallium nitride materials, it can be increased to around 120 watts in a similar size. Industry executives and analysts say this means that users can fully charge their smartphones in less than 10 minutes.

Both gallium nitride and silicon carbide are known as wide bandgap semiconductors. Compared to more common silicon-based chips, wide bandgap chips can handle higher voltages and are more durable at higher temperatures. Of the two, silicon carbide is considered more suitable for power chips in high-power electric vehicle chargers and energy storage systems.

In addition to acquiring GaN Systems, Infineon has invested €2 billion to expand production capacity of gallium nitride and silicon carbide chips at its Kulim, Malaysia, and Villach, Austria factories. White said GaN Systems works closely with the world's largest contract chip manufacturer TSMC and that this plan will continue even after Infineon completes its acquisition of the Canadian company.

He said traditional silicon-based power chips are still important and noted that Infineon has decided to invest €5 billion to increase production of such chips in Dresden, Germany. However, he added that growth in this area is expected to be slower compared to wide bandgap semiconductors.

According to Brady Wang, a semiconductor analyst at Counterpoint Research, there is no doubt that wide bandgap semiconductors will be the main growth driver in the market, driven by the need for better power solutions.