München Silicon carbide is the chip material of the future. The manufacturers of electric cars are vying for the innovative material. Only one thing slows down the even more rapid spread of semiconductors: They are at least twice as expensive as conventional silicon components.
Michael Rüb wants to change that. With the start-up mi2-factory, the professor from Jena wants to reduce production costs by 30 percent as a first step. In the long term, the 54-year-old believes it is even possible to halve the price. That would be a blessing for the European chip industry. Silicon carbide (SiC) semiconductors are one of the few areas in the industry where Europe is still world class.
But the physicist has to solve one problem beforehand: he needs a two-digit million sum to build a prototype of his chip machine. In view of the announcements by politicians that billions would be made available for the chip industry, substantial government funding shouldn’t be a problem – Rüb thought.
Brussels and Berlin have announced great support in recent months, but it is still unclear when and with how much money mi2-factory can expect. “To this day we don’t even know how high the funding rates are,” says the founder angrily.
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Many chip companies and their customers are disappointed by politics. Europe’s chip catch-up threatens to be delayed before it begins. Even large semiconductor manufacturers complain privately that state aid is a long time coming and that the award rules tend to delay innovations rather than accelerate them.
A high-earning Dax group like Infineon, Germany’s largest chip group, can do without state financial aid – even if the companies are then disadvantaged compared to competitors from Asia. A young company like mi2-factory with only seven employees so far, on the other hand, could fail if there are no subsidies.
The EU has set itself ambitious goals. With a large-scale funding program, the Chips Act, Europe is to more than double its share of global semiconductor production by 2030 – to 20 percent. Commission chief Ursula von der Leyen presented the plan at the beginning of the year.
The law is an industrial policy offensive, with which the EU wants to make up for Europe’s deficit to other regions and reduce dependency on Asia. In order to achieve this goal, Brussels wants to interpret the previously strict rules for state aid more liberally. 43 billion euros in public funds are to flow.
Only the companies have so far none of it. The so-called IPCEI program seemed particularly promising to Rüb. It stands for “Important Project of Common European Interest”. Generous aid criteria apply to these projects. The EU states can therefore promote them very comprehensively.
mi2-factory pushes into the core of chip production
Rüb’s team has developed a technology for so-called doping, a core process in chip production. Foreign atoms are introduced into a base material, in the case of the mi2-factory this is silicon carbide. This allows the conductivity or dielectric strength of power semiconductors to be adjusted.
The process the company uses is high energy ion implantation. The Thuringian experts have combined this with what they call an energy filter for the first time. This makes the process more precise, which enables smaller semiconductors, new types of components and innovative substrates, thereby reducing costs.
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Originally, Rüb only wanted to produce the filter itself with the company founded in 2016. “It took us some time to realize that we had to build a complete machine,” says the entrepreneur. In order to commission the first system from a machine builder, Rüb now needs new money from financial investors. How high this amount has to be depends entirely on what the state ultimately provides. Serious negotiations are hardly possible in view of the impasse, complains Rüb.
Domestic chip start-ups are enormously important for the German economy as a whole and for the established chip manufacturers in particular. This is shown by the examples of Infineon and Bosch. In 2016, the US government prevented Infineon from acquiring American rival Wolfspeed, which specializes in SiC. The acquisition endangers national security, it was said in justification.
In order to make progress in the strategically important growth area of SiC, the Dax group bought Siltectra from Dresden two years later for 124 million euros. The company, which was eight years old at the time, focused on cutting wafers from the innovative material.
The automotive supplier and chip manufacturer Bosch, in turn, acquired the Dresden start-up Arioso this spring. The Saxons have developed micro loudspeakers based on MEMS (micro-electro-mechanical systems). Bosch uses this technology for its important sensor business. In addition to SiC, sensors are another field in which Europe can still compete with chip groups from Asia and the USA.
>>Read here: Silicon carbide: Chip companies are investing billions in the material of the future
The Federation of German Industries (BDI) is therefore urging the EU to decide quickly on the projects to be funded with IPCEI. According to a position paper that has just been published, the approval procedures must be accelerated and the funds allocated at an early stage. Industry associations such as Silicon Saxony or the Association of the Electrical and Digital Industry (ZVEI) are also calling for more speed.
The demand for chips is increasing massively
“We are seeing a massive increase in chip demand,” says ZVEI Managing Director Wolfgang Weber. An increase of eight percent per year can be expected across all semiconductors, with power semiconductors – to which SiC chips belong – it is twice as high.
Founder Rüb does not expect a funding decision until the fourth quarter at the earliest, maybe not until the beginning of 2023. The first machines could then be in the chip factories in three or four years. After all, the first companies in Germany have now received approval from the federal government to start IPCEI projects at their own risk. This is a good signal, said the semiconductor group Infineon on request. According to previous rules, existing projects were not funded. The mi2-factory, however, does not help much, the start-up needs the money from the state to get started.
If the technology proves itself, there should be no shortage of orders. This is because SiC chips allow electric cars to have longer ranges, and they are also more compact than conventional chips. Infineon has just announced plans to build a new factory for SiC semiconductors in Malaysia. “We are in the right market at the right time,” says Rüb. The right support is still missing.
More: Mobile communications: Why Qualcomm operates a factory in the middle of Munich.