"Growing the Core Material Ecosystem for Electric Vehicles" SK Invests in Power Semiconductor Company Shares

A Yes Power Technics official is holding a wafer with the chip manufacturing process completed.

[Asia Economy Reporter Choi Dae-yeol] SK Inc. is entering the silicon carbide (SiC) power semiconductor market. Power semiconductors, which have higher energy efficiency compared to conventional silicon (Si)-based semiconductors, are a core area in advanced materials and essential components for future vehicles such as electric vehicles and hydrogen cars. Due to high technological barriers, the market has long been dominated by a few companies mainly in the US and Europe, resulting in a prolonged supply shortage.

Yes Power Technics, the company SK Inc. invested in this time, was established in 2017 and is the only company in Korea with a production system for SiC power semiconductors. SK Inc. secured a 33.6% stake by investing 26.8 billion KRW. Power semiconductors are essential semiconductors that control current direction and power conversion in electronic devices requiring electricity, electric vehicles, hydrogen cars, and 5G communication networks.

The company explained that SiC power semiconductors maintain power conversion efficiency above 98% even in extreme environments of high temperature and high voltage, combining durability, stability, and versatility, thus replacing the existing Si power semiconductor market as a next-generation core technology. Demand surged after Tesla first applied SiC power semiconductors to the Model 3 mass production model in 2018.

However, due to high technological barriers and the limited number of companies with mass production capabilities, global supply remains tight. Although demand has increased domestically, especially among electric vehicle, home appliance, and 5G-related companies, supply constraints have led to ongoing calls for urgent localization. According to market research firm IHS Markit, the SiC power semiconductor market is expected to grow from about 700 million USD last year to 10 billion USD by 2030, with an average annual growth rate of approximately 32%.

Yes Power Technics, which SK Inc. invested in, was founded by R&D experts with over 10 years of experience in SiC power semiconductor development. The company holds 23 patents. It is the only company in Korea with a production system including high-temperature process lines, capable of producing up to 14,400 wafers annually at its Pohang plant, equivalent to the volume needed for 140,000 electric vehicles. Given the market characteristics formed by customized small-volume production, the underlying technology must enable designing optimized chips tailored to diverse customer demands, and production know-how to control high-temperature processes is also essential.

SK has previously identified advanced materials, green, bio, and digital sectors as its four core businesses and clearly stated its intention to operate as a specialized investment company. A company official said, "If the existing 1st and 2nd generation semiconductors were the 'rice of industry,' SiC power semiconductors are the 'rice of the eco-friendly industry,' forming the foundation of eco-friendly industries such as electric vehicles and renewable energy." He added, "With this investment, we will accelerate ESG management at the group level, reduce overseas dependence on SiC power semiconductors, and lead the market."