(Yicai) Oct. 25 -- Semiconductor Manufacturing Electronics Corporation, a leading Chinese chip foundry, said it will establish an automotive-grade silicon carbide joint venture with a total investment of CNY500 million (USD68.4 million) amid optimism about the prospects for using power semiconductor devices in new energy vehicles.

SMEC will invest investing CNY255 million in Xinlian Power Technology, maiking it the controlling shareholder, while institutional investors under several carmakers will also pitch in, the Shaoxing-based firm announced today. 

Other shareholders include Shang Qi Capital, the private equity arm of auto giant SAIC Motor, Rockets Capital, under electric vehicle startup Xpeng Motors, Apple supplier Luxshare Precision Industry's Liling Private Equity Fund Management, as well as Shaoxing Xinlian Corporate Management Partnership, Boyuan Capital and Ningde Chendao New Energy Industrial Investment Partnership, SMEC noted.

Guidance funds and state-owned capital from multiple regions, including Chongqing, Jiangxi province, and Shanxi province, will also invest in the JV, the company said.

NEVs, wind and solar energy storage, and industrial automation and control contribute over 80 percent to SMEC's revenue, said Chief Executive Zhao Qi. The partnership with firms in the industry chain is intended to achieve technological advantages and large-scale mass production of SiC MOSFETs to support domestic independence and control in medium- and high-end applications such as NEVs and wind and solar energy storage, Zhao added.

Silicon carbide has the characteristics of high voltage, high frequency, and low consumption, enabling the compound to maximize energy conversion efficiency. It has been applied on a large scale in NEVs and charging piles. 

The global market for silicon carbide will reach USD6.3 billion by 2027, with a compound annual growth rate of 34 percent, French consultants Yole predicted in a report.

Editor: Martin Kadiev