Archive for the ‘Sic (Silicon Carbide)’ Category

by Matt Margolis

refractory furnace

 

On April 7th, 2014 GT Advanced Technologies announced that it has received a $58.6m order high temperature refractory metal furnaces that are used for a variety of industrial purposes.  GT also indicated that the revenue associated with this order is expected to be booked in the 2H2014.  I was wondering just like everyone else where did this come and what was it for?  The highlight from the press release announcing the deal is below:

GT Advanced Technologies (GTAT) today announced that it has received $58.6 million in orders this quarter for high temperature refractory metal furnaces that are used for a variety of industrial purposes. These orders will be reflected in Q2 reportable backlog and GT expects to recognize revenue from these orders during the second half of 2014.

“Thermal Technologies, which was acquired by GT in 2013, developed the high temperature refractory furnace technology that will be deployed as part of these orders. It is expected that several other industrial products developed by Thermal Technologies, will be taken to market through our existing sales and service channel, adding to our diversification beyond our traditional markets,” said Tom Gutierrez, GT’s president and CEO.

According to the press release this $58.6m order was related to high temperature refractory furnace technology  that was developed by Thermal Technologies (who was acquired by GT in 2013).  So what are refractory metals?  According to wikipedia, they are a class of metals that are extraordinarily resistant to heat and wear.  The most common definition of refractory metals include niobium, molybdenum, tantalum, tungsten and rhenium which all share a melting point above 2000 °C .  I did well in my high school science classes but I don’t have a fond memory of these periodic table elements but needless to say they work great in refractory furnaces.

 

Refractory Metals Screenshot

GT’s refractory furnace sales most likely fell under under one of two categories; automatic processing furnace systems (APF) and ceramic processing furnace systems (CPF).  Refractory furnaces do not need to be attended (unlike sapphire growth furnaces) and they rapidly heat and cool (unlike sapphire growth furnaces).  The APF and CPF furnaces are used to process high purity advanced ceramic materials.   Advanced ceramic materials include  include silicon carbide and tungsten carbide.    Silicon Carbide is currently sold in various forms including fiber, foam, power, monofilament and sheet.  Advanced materials are commonly found on crushing equipment for mining and also are used in medicine, electrical and electronics industries.   GT is already focused on the Silicon Carbide market and I believe this was GT’s first sizable furnace order that will be focused on melting and forming Silicon Carbide products.  It is also important to note that the Thermal Technology products and Silicon Carbide were completely left of GT’s March 14th Technology conference.  I believe there is an opportunity for GT to create even more shareholder value through the sale of its Thermal Technology equipment tool set.  Stay tuned to the Obscure Analyst for further updates on this hidden gem!

 

Automatic processing furnace systems (APF) and ceramic processing furnace systems (CPF) provide fully automatic, unattended operation at temperatures to 2500°C. Parts processing is quickly cycled with rapid temperature ramp up (>100°C/min) and ramp down (up to 300°C/min). These systems may be configured as a hydrogen furnace and/or high vacuum furnace.  In addition to the main heating element, optional top and bottom trim heaters are available for excellent temperature uniformity throughout the entire hot zone.
Thermal Technology’s APF and CPF furnaces are used for processing high purity advanced ceramic materials which are susceptible to contamination in traditional graphite furnaces. These furnaces also process refractory metals under high vacuum conditions at elevated temperatures and can be supplied without high vacuum pumps for processing in inert or reducing gas atmospheres.

– See more at: http://www.thermaltechnology.com/production-furnace.html?id=100#sthash.pffbRuQi.dpuf

Automatic processing furnace systems (APF) and ceramic processing furnace systems (CPF) provide fully automatic, unattended operation at temperatures to 2500°C. Parts processing is quickly cycled with rapid temperature ramp up (>100°C/min) and ramp down (up to 300°C/min). These systems may be configured as a hydrogen furnace and/or high vacuum furnace.  In addition to the main heating element, optional top and bottom trim heaters are available for excellent temperature uniformity throughout the entire hot zone.
Thermal Technology’s APF and CPF furnaces are used for processing high purity advanced ceramic materials which are susceptible to contamination in traditional graphite furnaces. These furnaces also process refractory metals under high vacuum conditions at elevated temperatures and can be supplied without high vacuum pumps for processing in inert or reducing gas atmospheres.

– See more at: http://www.thermaltechnology.com/production-furnace.html?id=100#sthash.pffbRuQi.dpuf

Automatic processing furnace systems (APF) and ceramic processing furnace systems (CPF) provide fully automatic, unattended operation at temperatures to 2500°C. Parts processing is quickly cycled with rapid temperature ramp up (>100°C/min) and ramp down (up to 300°C/min). These systems may be configured as a hydrogen furnace and/or high vacuum furnace.  In addition to the main heating element, optional top and bottom trim heaters are available for excellent temperature uniformity throughout the entire hot zone.
Thermal Technology’s APF and CPF furnaces are used for processing high purity advanced ceramic materials which are susceptible to contamination in traditional graphite furnaces. These furnaces also process refractory metals under high vacuum conditions at elevated temperatures and can be supplied without high vacuum pumps for processing in inert or reducing gas atmospheres.

– See more at: http://www.thermaltechnology.com/production-furnace.html?id=100#sthash.pffbRuQi.dpuf

Automatic processing furnace systems (APF) and ceramic processing furnace systems (CPF) provide fully automatic, unattended operation at temperatures to 2500°C. Parts processing is quickly cycled with rapid temperature ramp up (>100°C/min) and ramp down (up to 300°C/min). These systems may be configured as a hydrogen furnace and/or high vacuum furnace.  In addition to the main heating element, optional top and bottom trim heaters are available for excellent temperature uniformity throughout the entire hot zone.
Thermal Technology’s APF and CPF furnaces are used for processing high purity advanced ceramic materials which are susceptible to contamination in traditional graphite furnaces. These furnaces also process refractory metals under high vacuum conditions at elevated temperatures and can be supplied without high vacuum pumps for processing in inert or reducing gas atmospheres.

– See more at: http://www.thermaltechnology.com/production-furnace.html?id=100#sthash.pffbRuQi.dpuf

Automatic processing furnace systems (APF) and ceramic processing furnace systems (CPF) provide fully automatic, unattended operation at temperatures to 2500°C. Parts processing is quickly cycled with rapid temperature ramp up (>100°C/min) and ramp down (up to 300°C/min). These systems may be configured as a hydrogen furnace and/or high vacuum furnace.  In addition to the main heating element, optional top and bottom trim heaters are available for excellent temperature uniformity throughout the entire hot zone.
Thermal Technology’s APF and CPF furnaces are used for processing high purity advanced ceramic materials which are susceptible to contamination in traditional graphite furnaces. These furnaces also process refractory metals under high vacuum conditions at elevated temperatures and can be supplied without high vacuum pumps for processing in inert or reducing gas atmospheres.

– See more at: http://www.thermaltechnology.com/production-furnace.html?id=100#sthash.pffbRuQi.dpuf

Full Disclosure: I am long GTAT and will add additional shares once my April blog revenue arrives.

 

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by Matt Margolis

In December 2013 PVA TePla of Wettenberg, Germany launched the baSiC-T physical vapor transport (PVT) crystal growth system (which uses sublimation of a source powder at high temperatures) for the mass production of silicon carbide (SiC) material.

The equipment announcement also indicated the current market for SiC crystals (see below)

Typical applications of SiC crystal include high-performance electronics for end-markets such as hybrid and electric cars and air-conditioning systems, as well as optoelectronics applications such as LEDs and DC/AC converters for photovoltaics.

The major advantage of silicon carbide material lies in the energy-saving potential of over 40% compared with conventional silicon components, says the firm. In addition, SiC can also be used at high temperatures and high voltages in excess of 10,000V, dramatically exceeding the potential of silicon.

PVA TePla says that the design of the baSiC-T system is based on a modular concept and allows the use of substrates (seeds) with a diameter ranging from 100mm to 150mm. Low operating costs and a high degree of automation facilitate inexpensive mass production of silicon carbide, the firm claims.

GT Advanced Technologies introduced their Siclone 100 furnace in July 2013, which could produce wafers up to 100mm in diameter. It appears that the competition has a 50mm wafer size advantage, but GT has the ability to couple their Siclone 100 furnaces with Hyperion to produce ultra thin wafers between 25 and 50 microns thick.

MERRIMACK, N.H., July 1, 2013 (GLOBE NEWSWIRE) — GT Advanced Technologies (Nasdaq:GTAT), today introduced its new SiClone™100 silicon carbide (SiC) production furnace. The SiClone100 uses a sublimation growth technique capable of producing high quality semiconducting bulk SiC crystal that can be finished into wafers up to 100 millimeters in diameter. In its initial offering, the SiClone100 is targeted at customers that have developed their own hot zone, qualified a bulk crystal production recipe and are looking to begin volume production.

My Obscure takeaway is that the Silicon Carbide (SiC) marketplace is beginning to take shape. Competition is a good thing because it means that companies are competing to win contracts within the SiC marketplace that has yet to go mainstream.

GT summarized the current marketplace in July at the time of the Siclone 100 product release.

The company continues to expect SiC furnace sales to contribute to less than 1% of its calendar year 2013 revenue and expects the SiC revenue ramp in 2014 and beyond to develop at a gradual pace given the lengthy design cycle associated with new power devices.

Keep an eye on the Silicon Carbide marketplace because the competition has arrived and I’m thinking SiC furnace orders will begin to be placed sooner rather than later. The biggest question that remains is who will dominate the SiC furnace marketplace?

Full Disclosure: I am long GTAT and have no plans to buy or sell anytime soon

GT has the Technology and Know-how to Energize Tesla’s Lithium-Ion Gigafactory – by Matt Margolis

GT Advanced Technologies changed their from GT Solar in August 2011.  Having spent significant amount of time examining the ins and outs of GT’s business I’ve learned a lot.  First off, the name “Advanced Technologies” couldn’t be closer to the truth, because GT’s technology is so far advanced compared to the competition.  I recently was asked, “what is GT’s next big product” and my response was “something we have never heard of”‘.  The reason I gave that kind of answer is because GT’s technological innovations are so far ahead of the products that will utilize those technologies.  However, I do believe the gap of technological innovation versus market adoption is beginning to close rapidly.  Tesla recently held discussions with Apple, which in part could be related to Tesla’s plan to open a Giga Factory to produce Lithium Ion batteries for motor vehicles and possibly electronic devices such as Apple’s suite of iDevices.  At this point it’s anyone’s guess, but it makes sense for Apple to team up with Tesla to improve battery life and user experience with their iDevices.

My fellow sleuths and friends (Chelle and Cali Sun/Chad X on SA) introduced the idea of a Tesla & GT partnership to
me several weeks ago and I owe them a tremendous thank you for their analysis and for opening my eyes to the possibilities.  I took what they started and did what I do best and I investigated.  Through my extensive research and unique approach and vital help from my fellow sleuths I’m going to paint a picture of why GT has the necessary ingredients to team up with Tesla sooner rather than later.

Thermal Technology Acquisition

GT made it clear almost two years ago that they were interested in getting into thermo electric converters for hybrid electric vehicles.  This interest was highlighted the press release when GT acquired Thermal Technology.

The company has also acquired Spark Plasma Sintering (SPS) technology, which allows dense ceramics to be obtained under uniform heating at relatively low temperatures and in short processing times. The SPS technology is expected to have a wide range of applications including with medical applications, sputtering targets, space applications and thermoelectric converters for hybrid electric cars.

One important item to highlight is Spark Plasma Sintering (SPS) technology, this wild machine turns ceramic powder into a dense crystalline material in less than 5 minutes versus other machines that take hours.   GT envisions using this technology to and their ceramic patent  (acquired through GT’s purchase of Twin Creek’s Technology) to create a thin semiconductor lamina adhered to a ceramic body.  The ceramic bodies would be formed using GT’s SPS technology.  The patent states that devices can be formed in the lamina, including photovoltaic devices. The ceramic body and lamina can withstand high processing temperatures. In some embodiments, the ceramic body may be conductive.  This ceramic patent also involves Hyperion to produce thin semiconductor lamina.

THE SPS PROCESS

Unique to SPS is the DC current generating heat internally, as opposed to conventional methods of materials densification such as hot pressing, wherein the heat is external to the sample. While other traditional methods of materials processing require hours to reach peak temperature, Thermal Technology’s SPS takes only minutes. The clear benefits of SPS are the significant savings of time and energy and the ability to retain nano-structures.

Screenshot - 3_9_2014 , 9_52_15 PM

An automotive thermoelectric generator (ATEG) is a device that converts waste heat in an internal combustion engine (IC) into electricity using the Seebeck Effect. A typical ATEG consists of four main elements: A hot-side heat exchanger, a cold-side heat exchanger, thermoelectric materials, and a compression assembly system. ATEGs can convert waste heat from an engine’s coolant or exhaust into electricity. A Thermoelectric converter in the simplest form can be found in this youtube video, as a glass of icy cold water and hot water power a fan.

The version that GT would use would be closely related to Solar power but instead of a solar cell it would use a Thermo Electric Converter Cell.  This technology appears difficult but the key to making this product work is ultra thin film which is something Hyperion and GT’s ceramic patent can deliver.
A Thermo Electric Converter cell is a device that converts heat to electricity.  The quest for such a device has been around for many years, and has resulted recently in many innovations, however there is not yet a machine that converts heat directly to electrical energy by using a chemical reaction.The problems are mostly that most chemical compounds do not react in a reversible way at temperatures below 100 degrees Celsius.There is a specific group of compounds that do react in a way that favours the phenomenon that Thermo Electric Converters employ to generate electricity.
Silicon Carbide – What is it and Why it’s Important
I found an interesting research paper on Silicon Carbide (SiC) and how this semi-conductor material is needed to replace Silicon (Si) because there is not much more benefits that can be found due to the limited performance benefits of Si versus Sic. SiC is a wide band-gap semiconductor and the benefits of using SiC in power electronics is tremendous.  The issue has always been the cost of processing and fabricating SiC material.    If you haven’t learned anything yet, then it’s time to start paying attention.  GT is the company with the best technology around and they know exactly how to cut cuts to drive technology adoption.
The superior properties of silicon carbide (SiC) powerelectronic devices compared with silicon (Si) are expected to have a significant impact on next-generation vehicles, especially hybrid electric vehicles (HEVs). Thesystem-level benefits of using SiC devices in HEVs include a large reduction in the size, weight, and cost of the power conditioning and/or thermal systems.
Screenshot - 3_9_2014 , 10_51_33 PMScreenshot - 3_9_2014 , 10_51_54 PM

GT has been eying the SiC industry opportunity for years.  The research paper on the topic was published in 2002 and it’s been nearly 12 years and to be honest the SiC industry appears ready to take off very soon.  Below are a few comments from GT over the past two years which indicates how significant the SiC industry is in terms of potential revenue as well as where they think they have an opportunity to grow the business (Power Electronics).    If you want to know specifically what area GT is targeting for Power Electronics then you just need to look at page 4 of their Corporate Overview.   The answer, is Power Systems for electric vehicles (see image below).

Screenshot - 3_9_2014 , 11_10_59 PM

I came across a comment on a message board and one of the astute posters noticed that the image on page 4 of GT’s Corporate Overview is also the same image as Tesla’s new Model S (image below).  It could be that GT has good taste in Tesla’s electric vehicles or possibly the two have had discussions already.  Either way, given Elon Musk’s goal to increase Tesla sales to 500,000 by 2020 from 25,000 in 2013, GT made the right call on the image for their Corporate Overview.

Screenshot - 3_8_2014 , 2_38_21 PM Screenshot - 3_8_2014 , 2_38_55 PM

GT Q2 2012

But an industry that could have even more growth is the cost of the silicon carbide wafers, for example, and other technology we’re to develop. And so we remain committed to obviously having a protected and strong position in the markets that we’re already in today, but at the same time, expanding into new verticals. And power semiconductors is the one that we’ve identified as our next area of significant focus.

GT Q4 2012
We have a sourcing chain and a logistics chain that’s enviable for producing equipment. That’s one piece of it. The other piece of it is, we actually have a substantial amount of GaN technology in-house. I mean, we — one of GT’s heritage is that it was involved in silicon carbide and GaN and a variety of other tools long ago, and we have a lot of PhD’s and a lot of people that are very familiar with the technology.
GT Q2 2013

Before turning the call over to Rick, I’d like to provide additional color on GT’s other diversification and growth initiatives. At the end of Q2, we released our first generation silicon carbide sublimation furnace. Design-in cycles for power devices are relatively long. And as such, we expect our silicon carbide business to ramp slowly. In the longer-term, the higher growth opportunity with silicon carbide for GT is in pairing it with our Hyperion technology in order to produce thin silicon carbide lamina at a fraction of the cost of what wafers cost today.

GT Q3 2013

Our silicon carbide initiative has been in progress for over a year. We have made excellent headway, and based on direct feedback from potential customers, it is clear that the market is looking for a full silicon carbide solution complete with process recipes. We believe that the differentiated process recipes that we are developing will provide a path to producing lower-cost silicon carbide. GT is on target to release a 4-inch solution in the first half of next year and to follow that up with a 6-inch solution by the end of 2014. We’re currently seeking strategic partners to support our silicon carbide development. Given the high cost of silicon carbide wafers, the real opportunity for silicon carbide remains in pairing it with Hyperion, which should enable thin wafer cost structures that are nearly an order of magnitude below today’s state-of-the-art wafering processes. Such an advance would significantly expand this opportunity for GT.

The Current SiC Power Electronics Market Adoption

As you can see below, SiC Power Electronics are just beginning to gain attraction across the auto mobile industry and the transportation industry including trains.  SiC power electronics are needed to improve fuel economy, by reducing weight and power consumption.  Mitsubishi Electric seems to be making the biggest strides in cornering the Sic power electronics end user marketplace.   You can tell from some the specific details that SiC has a tremendous impact on the size of the power electronics as well as the energy consumption.  Silicon Carbide (SiC) taking over for Silicon (Si) will be the next major revolution to lower the amount of energy consumption in electronic devices just like LED is doing for light bulbs all across the globe.

March 8, 2012 – Mitsubishi Electric Develops EV Motor System with Built-in Silicon Carbide Inverter

July 9, 2012 – Mitsubishi Electric to Begin Shipment of Silicon Carbide Power Module Samples.
December 27, 2013 – Mitsubishi Electric launching 3.3kV, 1500A inverter with all-SiC power module for high-power trains
Size and weight are reduced by about 65% compared to conventional inverter systems with IGBT power modules and about 30% compared to existing hybrid inverter systems with SiC diodes.
With help from Tokyo Metro Co Ltd, the system was field-tested in commercial railcars operating on its Ginza Line subway, demonstrating 38.6% energy reduction compared with conventional inverters in other railcars operating on the same line.
February 13, 2014 – Mitsubishi Electric announced today it has developed a prototype electric vehicle (EV) motor drive system with a built-in silicon-carbide inverter.
Tesla Motors $5B Lithium-Ion Gigafactory

Telsa announced a few weeks that it intends to spend $5B on a new plant to build batteries for its next-generation of electric vehicles.  Tesla’s goal is to build a plant that can produce enough batteries for 500,000 cars a year by 2020.  The 500,000 unit sales target has been around for since 2013.  For comparison, in 2013 Tesla sold just over 25,000 cars and driving up annual sales to 500,000 units is significant jump in sales and a lot of electric vehicle batteries compared to 2013 levels.    If Tesla really wants to improve the current batteries in the market today and they want to develop state-of-the-art lithium-ion batteries, then the key ingredient is graphene.  Northwestern University engineers in 2011 found that graphene electrodes can improve battery storage of lithium-ion batteries by 10 times and charge 10 times faster and last longer as well.  Tesla wants to improve the range of their vehicles and having a super charged lithium-ion battery featuring a graphene electrode will do the job and then some.

Engineers at Northwestern University have found that a specially-crafted graphene electrode can allow a lithium-ion battery to store 10 times as much power and charge 10 times faster — and last longer, too.

In state-of-the-art lithium-ion batteries there is a graphite anode, a metal oxide cathode, and an electrolyte containing a lithium salt. When discharging, lithium is forced out of the anode (+) and into the cathode (-), and during charging the reverse occurs. In essence, anode’s capability to handle and store lithium dictates the output voltage, total capacity (mAh), and charging speed. The Northwestern researchers, using graphene, have completely upended the very restrictive limitations of commonly-used anodes.

What is Graphene?

Graphene is a two-dimensional (2D) material with exceptional properties, such as ultra high electrical and thermal conductivities, wide-range optical transmittance and excellent mechanical strength and flexibility. These properties make it a promising material for emerging and existing applications in printed & flexible circuitry, ultra fast transistors, touch screens, advanced batteries and supercapacitors, ultra fast lasers, photodetectors and many other non-electronic applications.  One of the biggest problems is graphene is being able to produce graphene with high and consistent quality at acceptable costs.

Although graphene technology is still in its infancy, remarkable progress has been made in the last few years developing graphene production methods. Numerous opto and electronic devices based on graphene have been demonstrated on lab-scale models. However, the numerous challenges of graphene technology should not be underestimated. The lack of bandgap in graphene is its key fundamental challenge. Other technology challenges are related to the development of industrial methods to produce graphene with high and consistent quality at acceptable costs.

GT Advanced Technologies Can Deliver Graphene at lower Costs than Anybody Else?

If you remember above that GT stated that their silicon carbide process paired with Hyperion Technology can produce thin silicon carbide lamina at the fraction of the cost of wafers cost today.  The interesting thing about silicon carbide can produce graphene!  According to I-Micronews, “graphene materials can be produced as tiny flakes (nanoplatelets) or in the form of a large-size sheet on different substrates, such as a metal foil or silicon carbide (SiC)“.

Furthermore, I-Micronews states that, “The catalytic chemical vapor deposition (CVD) of graphene on metals, featuring the high potential for both scalability and high material quality, has the largest potential for mass production of graphene opto and electronic devices. Although the market potential of high-quality epitaxial graphene on SiC is limited by the dimensions and high costs of SiC wafers, it may be successfully applied to produce some high-end electronic applications. The nanoplatelets produced by different methods, such as liquid phase epitaxy or reduction of graphene oxide can be used to produce conductive inks for printed electronics and additive materials for energy storage devices, such as Li-ion batteries and supercapacitors”.

GT Q2 2013

In the longer-term, the higher growth opportunity with silicon carbide for GT is in pairing it with our Hyperion technology in order to produce thin silicon carbide lamina at a fraction of the cost of what wafers cost today.

GT just announced a deal with Kyma Technologies last month and acquired exclusive rights from Kyma Technologies, Inc. for its plasma vapor deposition (PVD) process technology and know-how.   The GT press released focused exclusively on the LED benefit but if you read the Kyma press release, you would find out it not only focused on the LED benefits but the benefits GT could find in nitride power electronics.  GT’s Spark Plasma Sintering (SPS) Technology is also touted as a technology that “retains nano-structures” and SPS will play a key role in Silicon Carbide (SiC) for the power electronics market as well as shaping graphene.

Kyma Technologies Feb 18, 2014

After many years of advancing our patented PVDNC™ technology, we are excited to partner with GT Advanced Technologies who we believe is well positioned to broadly disseminate this technology not only into the rapidly growing market for nitride based LEDs but also into the nascent market for nitride based power electronics,” said Keith Evans, Kyma’s President and CEO.

Dan Squiller – The “Battery” Guy

GT’s Dan , knows a few things about lithium-ion batteries having been the CEO of Powergenix,  before coming to GT in August 2012, as President of PV and Worldwide Operations.    PowerGenix focused on nickel-zinc batteries instead of lithium-ion batteries, but Dan Squiller is very familiar with both battery technologies.   Squiller was also involved in positioning PowerGenix to go after the hybrid vehicle battery market, so this segment of the market is also well-known to him.  In a 2011 interview, Dan Squiller actually discusses lithium-ion batteries as being expensive, but his new company GT Advanced Technologies might hold a key to reducing the cost of lithium-ion batteries and supercharging them with graphene nano structures.

Dan Squiller PowerGenix CEO, 2009

Lithium-ion batteries do have a higher power density than nickel-zincs, and a longer run time. That means they’re better suited to electric-only vehicles–a market that PowerGenix’s Squiller says he won’t be pursuing.

Obscure Analyst Takeaway

This has been a lot to digest in one article.  GT has some other aces up their sleeve related to the Power Electronics market place that involves ceramic formation, thin semi-conductor ceramic patent , Spark Plasma Sintering Technology (SPS), Silicon Carbide Furnaces to grow SiC along with Hyperion’s unique ability to exfoliate material to create the lowest cost SiC wafers. The cost of producing SiC wafers also has a direct relationship to the cost of producing nanoplatelets (tiny flakes) of graphene.  Let’s not forget that graphene material that holds the key to Tesla and their ability to design state-of-the-art lithium-ion batteries within their gigafactory that hopes to begin production by 2017.

GT Advanced Technology is always far ahead of the market adoption curve.  However, the Electric Hybrid Vehicle industry specifically Power Electronics will drive tremendous growth and demand for GT’s Silicon Carbide (SiC).  GT will play a major in providing affordable SiC wafers for this industry. Either as a full solution, furnace and Hyperion finisher or as a materials play to grow the SiC and finish it themselves with Hyperion.   As SiC adoption within the Power Electronics industry begins to take off, the lessons learned and cost reductions gained will open up a new market for GT to begin serving.   The next market that will open up will be semi-conductors for electronic devices, generators and household devices.

GT may not land a deal with Tesla tomorrow or even by the end of 2015, but if I was a betting man I wouldn’t bet against GT Advanced Technologies, because they have the technology and the ability to deliver the goods to Tesla Motors just like they are doing for Apple!

~Obscure Analyst 3/10/14

Full Disclosure I am long GTAT and have no plans to buy or sell any holdings in the next 72 hours.

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Matt Margolis -2/18/14

Kyma Technologies Background: Kyma Technologies was founded in 1998 and is located in Raleigh, NC.  Annual revenues are estimated at approximately $3m per year and they have 17 employees.   Kyma Technologies has managed to survive over the last 16 years through various venture capitalists funds raisers as well as several relatively small contracts awarded to them.  In 2003, Kyma received $1.4M from GE Technology Finance in the form of a line of credit to build out their gallium nitride substrates business.  Later in 2003, Kyma received $4m of Series B (venture capitalist money), which included support from Digital Power Capital and Siemens Venture Capital.  In 2011, Kyma landed a deal to will work with Veeco Instruments on a next generation LED manufacturing project funded by a $4 million award from the U.S. Department of Energy.   Less than 6 months ago in October, Kyma received an additional $3.2M of venture capitalist funding.

Screenshot - 2_18_2014 , 9_06_34 PM

This morning GTAT announced they had acquired exclusive rights from Kyma Technologies, Inc. for its plasma vapor deposition (PVD) process technology and know-how.  Based on the reading the announcement I believe GT will be paying Kyma a royalty fee based on units sold or a similar methodology.  I thought it would be interesting to compare the press releases from both companies GTAT and Kyma to see if there are any differences and sure enough there are!  Announcement from Kyma & Announcement from GTAT.

Analysis of opening statement: GTAT makes it very clear that they have acquired “exclusive rights” for Kyma’s plasma vapor deposition (PVD) process technology and “know-how”.    It sounds like GTAT not only gets the rights to the PVD system but also the IP (intellectual property) behind the technology.  Based on this language it appears GT will be paying Kyma an ongoing royalty fee for each PVD tool sold.  Kyma on the other hand only indicates that it has “licensed” the technology but does not state that it is an exclusive deal.

Opening statement from GTAT’s announcement is below:

GT Advanced Technologies (Nasdaq:GTAT) today announced that it has acquired exclusive rights from Kyma Technologies, Inc. for its plasma vapor deposition (PVD) process technology and know-how. The PVD of nano-columns (PVDNC™) technology developed by Kyma deposits a high-quality growth initiation layer of aluminum nitride (AlN) on wafers prior to gallium nitride (GaN) deposition. GT plans to commercialize a PVD tool that will complement its hydride vapor phase epitaxy (HVPE) system, which is currently in development. The combined offering will provide LED manufacturers with a higher throughput, lower cost solution to produce gallium nitride (GaN) templates on patterned or planar wafers. GT already has a high volume prototype tool incorporating Kyma’s PVDNC technology and expects to offer a production-ready tool in the first half of 2015.

Opening statement from Kyma is below:

Kyma Technologies, Inc., a leading supplier of advanced materials solutions that promote safety and energy efficiency, announced today that it has licensed its nitride semiconductor plasma vapor deposition of nanocolumns (PVDNC™) technology to GT Advanced Technologies.

Kyma has a rich history of advancing PVDNC™ technology to create a cost-effective nanocolumnar crystalline AlN nucleation layer on flat sapphire and silicon substrates as well as on patterned sapphire substrates. The nanocolumnar AlN presents an excellent surface for subsequent nucleation and growth of GaN buffer layers which are important for GaN LEDs and power electronics. Kyma has offered PVDNC™ AlN templates to the market for many years and also employs such templates as a starting material for growing bulk and thin film crystalline GaN by hydride vapor phase epitaxy (HVPE).

Analysis of closing statement: GTAT states they manufacturers will be able to “increase the throughput of their existing LED production lines and lower the capital expenditures…” while Kyma says that the (PVDNC) technology has the “potential to double the throughput of today’s MOCVD tools.”  It’s very interesting that GTAT went light on the technology benefits but Kyma wanted to make sure everyone knew this could double the throughput.

Closing paragraph from GTAT is below:

Today, GaN deposition on epi wafers is done in slower and more expensive MOCVD tools. By utilizing the combined PVD and HVPE processes to create low cost GaN templates, manufacturers will be able to increase the throughput of their existing LED production lines and lower their capital expenditures because they will need fewer MOCVD tools.

Closing paragraph from Kyma is below:

PVDNC™ technology is an excellent complement to GT’s recently announced move into HVPE equipment. The combination of PVDNC™ AlN nucleation layers and HVPE GaN buffer layers has the potential to double the throughput of today’s MOCVD tools and to improve the performance and yield of devices. The result is higher throughput of improved devices made at lower fabrication cost, a triple win for the customer.

One more omission from the GTAT announcement completely that was in Kyma’s announcement was but “also into the nascent market for nitride based power electronics”.  GTAT only mentions this deal in relation to LED but it may be one of the “secret” weapons for Power Electronics which is one of the 4 business swim lanes.  Slides pulled from the recent corporate overview support my theory above that this deal with Kyma is for LED as well as Power Electronics related to Silicon Carbide Systems as well as end market Power Systems for Electric Vehicles.

2014 Slide 4

2014 Slide 4

2014 Slide 4

2014 Slide 4

The Kyma100 HVPE Specs are below

Kyma100 HVPE System Specs

Kyma100 HVPE System Specs

This is a interesting fact sheet from Kyma and their focus on Support of Wide Bandgap Semiconductor Power Electronics including  Silicon Carbide (SiC).

Screenshot - 2_18_2014 , 9_14_33 PM

My takeaways:

  • GTAT acquired exclusive rights for Kyma’s PVD Tool and IP (Intellectual Property) associated with it
  • PVD tool can double the throughput of today’s MOCVD tools
  • GT plans to commercialize this tool beginning in 2015 partnered with their HVPE system in development for LED
  • PVD tool will also benefit SiC and Nitride Based Power Electronics (Power Systems for Electric Vehicles)

Mitsubishi Electric announced on December 25, 2013 that it launched a railcar traction inverter system for 1,500V DC catenaries that incorporates the world’s first all-silicon carbide (SiC) power modules made with SiC transistors and SiC diodes. The all-SiC inverter greatly reduces power loss, size and weight compared to conventional insulated gate bipolar transistor (IGBT) power modules and hybrid power modules made with Si transistors and SiC diodes.  Size and weight can be reduced 65% compared to conventional inverters with IGBT power, total energy consumption is reduced 30%.

The new traction inverter system’s switching loss is approximately 55% less than Mitsubishi Electric’s conventional inverter system incorporating IGBT power modules. The new system also increases regenerated energy through the use of regenerative brakes in all speed ranges. Thanks to these solutions, total energy consumption of railcar systems, including their motors, is reduced by about 30% compared to conventional systems.

Size and weight are reduced by about 65% compared to conventional inverter systems with IGBT power modules and about 30% compared to existing hybrid inverter systems with SiC diodes.

The dielectric strength voltage of SiC is about 10 times greater than that of Si (Silicon). SiC devices can operate at higher temperatures than Si devices because of the high breakdown voltage and low conduction loss of thinner semiconductors. Unlike the ongoing development of SiC diodes, development of SiC transistors has proven difficult due to problems with crystal preparation, which requires highly advanced insulation and package technologies capable of withstanding high temperatures. Mitsubishi Electric’s R&D and production units combined their respective expertise in semiconductor development and manufacturing to successfully develop the new large-capacity, all-SiC power module with MOS-FET for use in the world’s first all-SiC railcar traction inverter. Development of SiC power modules has been partially supported by Japan’s New Energy and Industrial Technology Development Organization (NEDO).

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It looks like SiC (Silicon Carbide) use is beginning to take off.  A report released a few days ago from semiconductor today highlighted the release of Mitsubishi Electric Corp and their development of a built in silicon carbide inverter.  The electric vehicle motor drive system will reduce the size of the motor and increase the passenger space and improve on energy efficiency and most likely fuel economy as well.  Complete details are below

Tokyo-based Mitsubishi Electric Corp has developed a prototype electric vehicle (EV) motor drive system with a built-in silicon-carbide (SiC) inverter.

Reckoned to be the smallest of its kind, the EV motor drive system is intended to enable manufacturers to develop EVs offering more passenger space and greater energy efficiency.

MitsubishiGlobal demand for EVs and hybrid EVs (HEVs) has been growing in recent years, reflecting increasingly strict regulations for fuel efficiency and growing public interest in saving energy resources and reducing carbon dioxide emissions, notes Mitsubishi Electric. As EVs and HEVs require relatively large spaces to accommodate their robust battery systems, there is a strong need to reduce the size and weight of motor systems and other equipment to ensure sufficient passenger space, the firm adds.

Mitsubishi Electric says that, with an integrated all-SiC inverter, its new prototype EV motor drive system has been downsized further (to 14.1L, for 60kW) due to having a smaller motor, resulting from improved thermal resistance between the motor drive system and cooling system. The system is equal to existing EV motors in power and volume, enabling replacement.

Mitsubishi Electric also highlights improved motor cooling performance, since the cooling system for both the motor and inverter are integrated due to the cylindrical shape of the power module accommodating parallel cooling ducts for motor and inverter. This ensures stable cooling with even a low-power pump.

Mitsubishi Electric plans to commercialize its new EV motor system after finalizing technologies for motor/inverter cooling, as well as downsizing the dimensions further and increasing efficiency.

Courtesy of wdam.com (see full details below) I was able to find a nice definition of Silicon Caribide as well as the current uses it has today and where the growth will occur in the future. Silicon carbide is produced synthetically by blending petroleum coke and sand under high temperature and pressure.  Industrials have used silicon carbide for blades, drill tips, and abrasive surfaces for polishing have been manufactured from silicon carbide as a cheaper alternative to diamond and diamond dust.  Due to the voltage-dependant resistance offered by SiC, the material has been used in lightening arresters and provides safe transfer of high voltages of electricity from lightening as it strikes the earth.  Steel and energy, electronics and semiconductors and automotives are the major end-user segments that have shown high demand for silicon carbide.  Medical & healthcare is expected to show the highest growth between 2013 and 2019 along with automotives.

Silicon carbide (SiC), also known as Carborundum is an exceptionally hard material that occurs in minor quantities in the Earth’s crust. It can also be manufactured synthetically by blending petroleum coke and sand (silica) under high temperature and pressure conditions. Diamond, boron carbide and boron nitrate are some of the substitute materials of silicon carbide that also possesses high hardness properties.

Owing to its hardness, silicon carbide has been extensively used as an abrasive material for various industrial applications. Blades, drill tips, and abrasive surfaces for polishing have been manufactured from silicon carbide as a cheaper alternative to diamond and diamond dust. Silicon carbide is also used as a structural material in composite armor, as ceramic plates in bullet-proof vests and in Dragon Skin, an armor device that uses silicon carbide disks as an integral part of its design. Due to the voltage-dependant resistance offered by SiC, the material has been used in lightening arresters and provides safe transfer of high voltages of electricity from lightening as it strikes the earth. Similar properties also helped advance their application in electrical circuits, and silicon wafers have been used on a large scale in electronics and semiconductors in the past few decades.

The SiC market was dominated by black SiC and green SiC and they accounted for over 90% of the total silicon carbide product segment in 2012. Black silicon carbide is majorly used in steel manufacturing to increase outputs of steel and recycled steel. Coated SiC, refractory SiC, metallurgical and metallurgical briquettes and SiC micro grit account for a smaller part of the market share and are used in some high-performance applications. Although black and green SiC dominate the SiC product segments, they are expected to show favorable growth in the forecast period.

Due to their exceptional physical properties and their versatility of application, they find diverse application bases in various end-user industries. Steel and energy, electronics and semiconductors and automotives are the major end-user segments that have shown high demand for silicon carbide. Together, these three end-user segments accounted for more than 70% of the market in 2012. Medical & healthcare is expected to show the highest growth between 2013 and 2019 along with automotives.

The preview of the Transparency Market Research report on the Global Silicon Carbide Market is below.  The major applications for SiC include Automotive, Aerospace, Military, Electronics, Healthcare, Steel and Energy Applications.  The relative size of the market is summarized a follows: 
According to the report, silicon carbide demand was over USD 1.45 billion in 2012 and is expected to reach USD 3.82 billion by 2019, growing at a CAGR of 15.3% from 2013 to 2019. In terms of volume, silicon carbide consumption is expected to reach 2,377.1 kilo tons in 2019, growing at a CAGR of 14.5% from 2013 to 2019.
Below is the full preview from Transparency Market Research:
Global Silicon Carbide Market – Industry Analysis, Size, Share, Growth, Trends and Forecast, 2013 – 2019
Transparency Market Research Report Add “Silicon Carbide (Black SiC, Green SiC) Market for Automotive, Aerospace, Military, Electronics, Healthcare, Steel and Energy Applications – Global Industry Analysis, Size, Share, Growth, Trends and Forecast, 2013 – 2019” to its database.

Albany, NY, January 11, 2014 –(PR.com)– Transparency Market Research has released a new market report titled “Silicon Carbide (Black SiC, Green SiC) Market for Automotive, Aerospace, Military, Electronics, Healthcare, Steel and Energy Applications – Global Industry Analysis, Size, Share, Growth, Trends and Forecast, 2013 – 2019”. According to the report, silicon carbide demand was over USD 1.45 billion in 2012 and is expected to reach USD 3.82 billion by 2019, growing at a CAGR of 15.3% from 2013 to 2019. In terms of volume, silicon carbide consumption is expected to reach 2,377.1 kilo tons in 2019, growing at a CAGR of 14.5% from 2013 to 2019.

Browse the full report:
http://www.transparencymarketresearch.com/silicon-carbide-market.html

Growing demand in the steel manufacturing and steel recycling industries and the dependence of electronics & semiconductors on silicon carbide are factors that are expected to drive SiC demand over the next five years. High level of precision involved in the manufacture of components and low tolerance specifications in their applications are expected to be key challenges for market participants in the coming years.

Black and green SiC were the dominant product segments, and accounted for over 90% of the overall market share in 2012. Black SiC is expected to continue holding its market position in the near future and is expected to grow at a CAGR of 15.4% between 2013 and 2019. Green SiC consumption is expected to reach 656.1 kilo tons by 2019. Coated, refractory and metallurgical SiC along with metallurgical briquettes and SiC micro grit accounted for a smaller part of the market with applications in high-performance applications.

Silicon carbide is primarily used in steel & energy, automotives, aerospace & aviation, military & defense, electronics & semiconductors and medical & healthcare end-user segments. Steel & energy showed the highest demand for silicon carbide in 2012 and accounted for more than 28% of the market. Electronics & semiconductors and automotives were the other major segments for the material and are also expected to show strong demand in the near future. Medical & healthcare is expected to show the most demand for silicon carbide during the forecast period and is expected to grow at a CAGR of 15.6% between 2013 and 2019.

Asia Pacific was the largest market for silicon carbide in 2012 and accounted for more than 50% of the global demand. Steel & energy, electronics & semiconductors and automotives were the major markets driving sales for silicon carbide in Asia Pacific, making it the largest market in terms of volume. Asia Pacific and RoW are expected to be strong future markets for silicon carbide owing to growing industrialization and infrastructure. SiC demand in North America and Europe is expected to reach 249.6 kilo tons and 375.6 kilo tons by 2019 respectively. ESK-SIC Gmbh, The Dow Chemical Company, Grindwell Norton Ltd. AGSCO Corporation, Entegris Inc., Norstel AB and Gaddis Engineered Materials along with others were key market participants in the SiC industry.

Silicon Carbide Market: End-user Analysis
Steel & energy
Automotives
Aerospace & aviation
Military & defense
Electronics & semiconductors
Medical & healthcare
Others (Chemicals, fabrication etc.)

According to a Sic Wafer market overview (January 2013) provided by researchandmarkets SiC wafer market is expected to annually by approximately 38% expanding from $59m in 2013 to $553m in 2020.    SiC powered devices can consume a fraction of the energy that silicon power devices consume as well as add to system stability and reliability.   Below are some details provided by researchandmarkets (link is above).

 

Since power semi-conductors, which are used in power supply units or power converters to save energy and reduce product sizes, play a great role in improving energy efficiency, system stability and reliability through unique functions, they are expected to contribute to solving the global issues in environmental production and energy saving.

In particular, SiC power devices, which theoretically consume 1/100 of the energy conventional silicon power devices do, are expected to save energy drastically. In addition, since they can not only save system costs but also be used under extreme conditions, when applied as high temperature devices, a great ripple effect is expected. Due to the excellent properties, SiC semi-conductor technologies have reached a significant level, and single crystal substrates have already been deployed in a commercial level in technologically advanced countries such as the United States, Japan, and Europe SiC semi-conductor devices. These countries are spurring research through huge projects.

Accordingly, power semi-conductor companies are already accelerating commercialization of SiC power devices, strengthening cooperation with SiC wafer manufacturers. The Japanese company, Rohm, which announced its plan to use SiC for all power semi-conductor production, acquired a 74.5% stake in the German SiC substrate manufacture SiCrystal from Siemens in 2009. The specialized semi-conductor application company, Power Integration, has developing applications for and HEVs and EVs, and inverters for PV/wind power generation, since it strategic investment ($30 million) into the U.S. SiC manufacturer, SemiSouth Laboratories, in 2010.

Thus, the global SiC Wafer market is expected to grow from a $52.6M business in 2012 into a $58.6M business in 2013. The market is expected to continue to grow rapidly with the annual growth rate of 2801%, hitting $87.9M in 2015 and $552.5M in 2020.

This report is dedicated to examining SiC technologies from SiC powder to pellets and single crystals, and analyzing the current SiC single crystal growth technologies and industry trends. In addition, it provides forecasts for the SiC market and each SiC wafer application market until 2020.

This report is expected to be a good help for SiC Wafer and power-semiconductor manufacturers, and companies considering market entry into related industries.

Silicon Carbide & Gallium Nitride Semiconductor Market
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A research report published in 2013 gets into the Market Drivers and Barriers, Key Applications, Device Cost Trend along with Device Manufacturers and Developers.  The 6 key applications for these products include Automotive/HEV, Industrial Motor Drives, PV Inverters, Power Supplies & UPS, Traction and Wind Turbines.
According to the charts in the presentation Sic Power Semiconductor Revenue is expected to jump from $225m today to $1.7B by 2022 drive largely by Industrial Motor Drives which will grow from approximately $10 to $500m by 2022.  The largest opportunities appear to be within Industrial Motor Drives ($500m), PV Inverters ($300m) and Hybrids, Electric Vehicles ($250m) and Power Supplies ($250) by 2022.  Power supply makes up most of the SiC Power Semiconductor revenue today.
The Gallium Nitride Power (Gan on Silicon) Semiconductor Market is expected to jump from $75m today to over $1B by 2022.  Power supplies are expected to make up $700m by 2022.
Together the overall SiC & Gan on Silicon Power Semiconductor Market will jump from approximately $300m today to $2.7B by 2022. Explosive growth is predicted to begin in 2016 as the combined market size nearly triples in 3 years from $700m to just under $2b by 2019.