Tesla and Hyundai Motor Seek US Onsemi... Establishing Power Semiconductor Hub in Bucheon (Comprehensive)

Investing 1.4 Trillion Won in Bucheon to Expand Production Line
Increased SiC Power Semiconductor Supply Due to Electric Vehicle Effect
Onsemi's Major Customers Include Tesla, Hyundai, and BMW

US power semiconductor company ON Semiconductor has established a new production line in Korea to expand its high-growth silicon carbide (SiC) power semiconductor business. By expanding domestic SiC power semiconductor production facilities to become the world's largest scale, the company plans to respond to the rapidly increasing market demand and increase its revenue sources. SiC power semiconductors are system semiconductors mainly used in electric vehicles, and ON Semiconductor's major customers include Tesla, BMW, and Hyundai Motor Company.

ON Semiconductor held a completion ceremony for the S5 line on the 24th at its Bucheon plant in Gyeonggi Province. The S5 is a new production line established at ON Semiconductor's domestic base in Bucheon. At full operation, it can manufacture over 1 million 8-inch (200mm) SiC wafers annually. ON Semiconductor added the S5 line to its existing production lines (S1, S2, S3, S4) to expand its SiC power semiconductor production capacity. This is the result of a 1.4 trillion KRW investment following the full-scale expansion plan initiated last year.

Hasan El Khoury, CEO of ON Semiconductor (left), and Simon Kitten, Vice President of ON Semiconductor Power Solutions Group, are answering reporters' questions at a press conference related to the completion ceremony of the S5 line held on the 24th at the Bucheon plant. / Photo by Kim Pyeonghwa

ON Semiconductor explained that the demand for SiC power semiconductors is exceeding supply. It pointed out that the market is rapidly growing, especially as SiC power semiconductors are used in electric vehicles. Market research firm Mordor Intelligence forecasts that the SiC power semiconductor market size will increase about threefold from $1.7 billion this year to $5.4 billion by 2028. ON Semiconductor increased production capacity this time to ensure stable product supply in the automotive sector, which accounts for 50% of its total sales.

Hassan El Koury, CEO of ON Semiconductor, said, "Power semiconductors are becoming increasingly important as essential components for electric vehicle operation," adding, "Tesla, BMW, and Hyundai Motor Company use ON Semiconductor products." He also explained, "SiC can solve the problems of existing power semiconductors," and "We have invested heavily in this related business and will continue to expand investments."

The Bucheon plant is an important foundation for such business promotion. It is ON Semiconductor's only SiC power semiconductor production base, where manufacturing and research & development (R&D) are all conducted. To understand why a foreign company carries out its core business domestically, one must know the history of the Bucheon plant. The Bucheon plant was originally a Samsung Electronics non-memory production facility. Samsung Electronics sold its power semiconductor business division to the US semiconductor company Fairchild in 1999, transferring the Bucheon plant as well, and ON Semiconductor acquired Fairchild in 2016.

At the S5 line completion ceremony held on the 24th at the ON Semiconductor Bucheon plant, ON Semiconductor officials and other attendees are seen performing the ceremony / Photo by ON Semiconductor

ON Semiconductor has set a goal to increase SiC power semiconductor production at the Bucheon plant tenfold by 2025 compared to the current level. In this case, the proportion of Korean-made products among the company's total power semiconductor production could increase to 35-40%. To achieve this, ON Semiconductor plans to hire up to 1,000 domestic employees, mainly local talent, over the next three years. This represents about 40% of the existing workforce (approximately 2,300 employees).

CEO Koury said, "Since the Bucheon facility is ON Semiconductor's only SiC manufacturing facility, it responds not only to demand from Asia-Pacific but also from North American and European customers," adding, "All business capabilities are concentrated in Bucheon, making it the hub for the SiC power semiconductor business." He also explained, "The equipment at the Bucheon plant can produce both 6-inch (150mm) and 8-inch SiC wafers," and "Currently, since demand for 6-inch wafers is high, we are focusing on that, but we plan to switch to 8-inch wafers within two years."

Power Semiconductors

Power semiconductors are system semiconductors that perform roles such as power conversion, current distribution, and control in electronic devices. They are used in various applications including home appliances, mobile devices, communication infrastructure, and electric vehicles. Recently, products made from new compounds such as SiC among power semiconductors have attracted attention. SiC power semiconductors are considered essential components for electric vehicles due to their superior resistance to high temperature and high pressure environments and their lightweight advantages compared to conventional silicon (Si) materials.

This content was produced with the assistance of AI translation services.