Insight: Commoditization Hits the SiC Industry

SiC substrate prices fall as low-cost Chinese wafers flood the market, pressuring Wolfspeed and reshaping EV supply chains and integration strategies.

The Silicon Carbide (SiC) substrate market is rapidly commoditizing as Chinese manufacturers flood the market with low-cost 6-inch wafers, driving down average selling prices. This shift has upended the economics for vertically integrated players like Wolfspeed, whose high-cost structure and ambitious expansion plans now face significant headwinds. Slowing electric vehicle (EV) adoption, excess capacity SiC substrate, and a sluggish transition to 8-inch wafers have further strained the industry. These pressures may lead to consolidation among substrate suppliers and raise concerns about the long-term viability of fully integrated business models. As Wolfspeed teeters on the brink of bankruptcy, the industry is rethinking its assumptions around scale, supply chain strategy, and timing.