News: Markets
17 August 2026
xEV power chip market to more than double to $14.5bn by 2031
Following a “reality check” in 2024–2025, when sales of hybrid electric vehicles gained ground and battery-electric vehicles growth slowed temporarily, the xEV industry is regaining momentum, notes Yole Group in its report ‘Automotive Powertrain and Electrification 2026 – Focus on Power Electronics’. The market research firm estimates that xEV production is growing at a double-digit compound annual growth rate (CAGR) during 2025–2031 to about 70% of global light vehicle production, with battery-electric vehicles (BEVs) alone accounting for 33 million units. In turn, the xEV power device market is growing at a 14% CAGR to $14.5bn by 2031.
“China is building a power electronics supply chain that answers to no one – strong in finished systems, device packaging, and semiconductor wafers and closing the gap on front-end chip manufacturing faster than most expected,” says Milan Rosina PhD, principal technology & market analyst, Power Electronics & Battery, at Yole.
The report provides strategic insight into the technical shift now underway inside the traction inverter, which accounts for the large majority of xEV power device revenue through 2031. In particular:
- power modules are growing at a CAGR of about 14%;
- silicon insulated-gate bipolar transistor (IGBT) modules remain dominant, reaching almost $7bn;
- silicon carbide (SiC) MOSFETs are rapidly gaining share, growing at a 21.5% CAGR during 2025–2031, driven largely by China’s BEV fleet; and
- gallium nitride (GaN) HEMTs comprise the fastest-growing technology of all, at almost a 90% CAGR, although they will remain a tiny market in 2031 compared with silicon and SiC devices.
Underpinning this shift is the industry’s move from 400V to 800/1000V architectures, concentrating rising semiconductor value into higher-voltage devices – segments rated 1.2kV and above are growing at a 27.4% CAGR during 2025–2031.
Furthermore, one of the main messages delivered by Yole’s analysts is the accelerating consolidation and regionalization of the xEV supply chain.
OEMs, particularly in China, are increasingly bringing traction inverter and e-axle production in-house, while tier-1 suppliers continue consolidating through mergers and acquisitions (M&As).
At the same time, Bosch, Renesas and Rohm are all reassessing their SiC manufacturing footprint amid overcapacity, and licensing and partnership deals continue multiplying as the industry shifts from technical validation to securing capacity and executing at scale.
