SiC substrate market shows signs of recovery, EVs to hit 65% by 2026

The SiC substrate market's boom-and-bust cycle began in 2018, when Tesla equipped the Model 3 with a traction inverter integrated with SiC power modules, prompting suppliers to aggressively ramp up capacity. As EV momentum weakened, demand for SiC power devices fell sharply and substrate prices collapsed. Now, with the EV market gradually recovering and renewable energy deployment expanding, the market is finally seeing signs of recovery. The planned high-voltage direct current (HVDC) power architecture for AI data centers is also expected to further stimulate demand for SiC substrates.

This recovery comes as the EV industry has broadly adopted SiC power devices in traction inverters, with Chinese brands like BYD, NIO, Xpeng Motors, Li Auto and Xiaomi, plus global automakers such as Porsche, Hyundai Motor Company, GM, BMW, Audi and Mercedes-Benz all following Tesla's lead. By 2026, EVs are estimated to account for 65% of SiC device applications, making them the largest application segment. The report also covers key applications of SiC substrates, their cost breakdown, major suppliers and their capacity expansion plans.

Whether the rebound holds will depend on how quickly demand from vehicles, energy and AI infrastructure absorbs the aggressive capacity that suppliers built during the boom years. For substrate suppliers and power device makers, the test is whether the projected initial rebound in six-inch SiC substrate prices in 2027 materializes, and whether the high-voltage direct current architecture planned for AI data centers from 2027 to 2028 becomes a meaningful new source of demand.