AUTOMOTIVE CHIPS China’s BYD launches new automotive chip; competes with Infineon
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German semiconductor manufacturer Infineon is facing tough competition from China’s BYD, which has rose to prominence in the last year and may soon become a dominant force in the automotive market.

BYD Co Ltd is a Chinese manufacturing company headquartered in Shenzhen and has extensive operations in the automotive space. Together with its subsidiaries, BYD engages in the R&D, manufacture, and sale of automobiles and related products.
Recently, however, the company has announced the upcoming launch of its new IGBT6.0 chip, a type of insulated-gate bipolar transistor (IGBT). IGBTs are a type of bipolar junction transistor (BJT) that are built in a way that allows for switching with low power losses, making them ideal for use as a switch in high power circuits, like those found in modern automobiles.
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IGBTs in automobiles
In electric vehicles, the battery stores direct current while the motor uses alternating current, and the power chip used in the vehicle acts as a bridge for the conversion of the current.
Thanks to the unique structure and technology of the IGBT, it has become a highly valuable component when compared with traditional power chips—they have a higher conversion efficiency, lower heat generation, low failure rates, and can withstand high voltages. They are used in various functions, such as perception via sensors and as control chips in ECU, MCU, or VCUs, and also as control elements in electrical components in functions such as steering and braking.
The IGBT has been described as “the CPU of an EV” because of this. It is the second-most expensive component in an EV after the battery, accounting for roughly seven to 10 percent of the total cost, according to recent market research.
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Competing with Infineon
With its dominant position and wide range of products, Germany’s Infineon rules the IGBT chip market in China. In 2019, the company had a market share of 58.2 percent, while BYD held around 18 percent.
Then, in mid-2020, BYD, which is backed by Warren Buffet, secured US$113 million (800 million yuan) in Series A+ funding for its chipmaking arm BYD Semiconductor to produce IGBTs. Since then, BYD’s market share has grown to “more than 20 percent,” according to a study by CITIC Securities.
The company is now fighting fierce competition against Infineon and today represents a serious competitor. Currently, BYD is the only Chinese company that can produce its own car chips. This gives the company a huge competitive advantage while other major players such as VW, Ford, and Toyota all struggle with the ongoing global chip shortage.
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Still, Infineon’s product offering is still much bigger than that of BYD’s. Since acquiring Cypress Semiconductor in April 2020, it has been the world’s largest manufacturer of automotive chips and is the leader when it comes to MOSFETs, memory chips, and chips for powertrains and advanced driver-assistance systems (ADAS).
With a worldwide boom expected to double the global market for IGBT chips by 2026 to almost US$11 billion, BYD may well obliterate Infineon in the Chinese market and become a major global player. However, the latter will depend more on politics than anything else. With countries like the United States fighting to re-establish domestic semiconductor manufacturing in a bid to fight of Chinese competition, BYD could struggle to fare better than the likes of Infineon and other competitors outside of the Chinese market.
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