Silicon EPI Wafer Market Research Report and Outlook by 2028

The Silicon EPI Wafer Market is projected to expand from US$ 3,008.57 million in 2022 to US$ 4,997.32 million by 2028, reflecting a compound annual growth rate (CAGR) of 8.8% during this period.

Gallium nitride (GaN) is a semiconductor material characterized by its wide bandgap, allowing devices to operate at elevated temperatures and voltages, surpassing the capabilities of silicon-based devices. GaN also exhibits a higher dielectric breakdown, facilitating the development of compact devices with reduced resistance and capacitance. Epitaxial GaN wafers are integral to power and radio frequency (RF) devices, known for their high efficiency and power output. These wafers find applications in various sectors, including defense radar systems, electric vehicle power converters, 5G base stations, and rapid chargers for electronic devices. A notable player in this field is IVWorks, a South Korean firm that utilizes deep learning-based artificial intelligence (AI) technology for the production of GaN epitaxial wafers. These wafers are essential for DC power devices and 5G communication technologies, and the company's innovative methods have garnered a US$ 6.7 million investment in Series B funding.

GaN's attributes, such as high electron mobility, current density, and breakdown voltage, make it a superior semiconductor for creating high-efficiency, high-output power devices that function at high frequencies. When compared to silicon (Si), silicon carbide (SiC), and gallium arsenide (GaAs), GaN outperforms in terms of size, speed, efficiency, and power output. However, unlike Si or SiC, GaN has not been fully developed using free-standing wafer technology, necessitating a heterogeneous substrate for its epitaxial growth. While Si can support larger diameter wafers at a lower cost, the significant lattice mismatch and differences in thermal expansion coefficients between Si and GaN complicate stress management and defect density control. The ongoing advancements in AI-driven GaN wafer technology present a promising opportunity for the expansion of the silicon EPI wafer market.

Impact of COVID-19 on the Silicon EPI Wafer Market
Europe is a crucial manufacturing center for many leading automotive companies, with modern vehicles relying heavily on small microchips for essential system operations. The automotive sector's dependence on semiconductor technology, including AI-based solutions, has negatively affected the growth of the silicon EPI market. The COVID-19 pandemic caused a significant shortage of microchips, impacting semiconductor vendors and manufacturers. This shortage was exacerbated by a surge in demand for consumer electronics, such as computers and smartphones, which outpaced supply and led to a critical semiconductor deficit.

Additionally, national restrictions and lockdowns during the pandemic disrupted microchip manufacturing facilities in Europe, further straining supply chains. Consequently, the increasing number of electronic devices in the region, coupled with the rising adoption of consumer electronics due to remote work trends, has contributed to the growth of the silicon EPI wafer market.

The analysis of the silicon EPI wafer market encompasses the Asia Pacific region, which includes India, China, Japan, Australia, and other areas. Many of the world's leading chip design firms depend on manufacturers located in this region, with South Korea and Taiwan being key players. TSMC and Samsung, the two largest semiconductor manufacturers, dominate over 70% of the global manufacturing market and serve as exclusive suppliers of advanced technology chips. The capital-intensive nature of semiconductor manufacturing and research necessitates significant investments. Taiwan produces more than half of the world's semiconductor chips and is continuously enhancing its processes to maintain its competitive edge, with the introduction of the advanced 3 nm technology anticipated in the latter half of 2022. The United States ranks as Taiwan's second-largest trading partner, accounting for 13.2% of total trade and receiving nearly one-third of Taiwan's information and communications technology (ICT) exports. Taiwanese foundries, particularly TSMC, are vital suppliers for numerous American companies, making their role essential for the sustainability of many American chipmakers' business models. Taiwan holds a significant position in the silicon EPI wafer market, as silicon wafers are fundamental raw materials in the semiconductor industry, and Taiwan is a leading manufacturer of these wafers.

Moreover, in China, investments have largely focused on various renewable energy initiatives due to anticipated cuts in subsidies, while solar energy has gained preference in Japan and India. The Asia Pacific region has emerged as a favored location for new projects, with substantial investment initiatives supported by Western European countries. Consequently, the growth of the renewable energy sector is positively influencing the silicon EPI wafer market.

The companies analyzed in the silicon EPI wafer market report include Applied Materials, Inc.; II-VI Incorporated; Shin-Etsu Chemical Co., Ltd.; SUMCO Corporation; Wafer World Inc.; Siltronic AG; Nichia Corporation; Global Wafers Japan Co., Ltd.; EpiGaN nv (Soitec Belgium N.V.); and SK Siltron Co., Ltd. Market participants are pursuing both organic and inorganic growth strategies to maintain their competitive advantage. For example, in September 2021, Applied Materials introduced two products designed to assist leading silicon carbide chip manufacturers in transitioning from 150mm to 200mm wafer production. Such initiatives by key industry players are expected to drive growth in the silicon EPI wafer market throughout the forecast period.

The evaluation of the silicon EPI wafer market is based on a combination of primary and secondary research methodologies. The research process begins with comprehensive secondary research utilizing both internal and external sources to gather qualitative and quantitative data related to the market. This secondary research provides an overview and projections of market size across all segments. To validate the findings and gain deeper analytical insights, multiple primary interviews have been conducted with industry stakeholders and experts, including VPs, business development managers, market intelligence managers, national sales managers, and external consultants such as valuation experts, research analysts, and key opinion leaders specializing in the silicon EPI wafer market.