How the Semiconductor Shortage Will Affect the Electric Vehicle DCFC Supply Chain

Mar 14

Most people are already aware of the “supply chain crisis” that has plagued the world since 2020. It started with mass buying of essentials during the COVID pandemic, and only worsened as the pandemic brought the world to a screeching halt with a combination of lockdowns, life changes and deaths. With vaccines now readily available and increasingly common, various sectors of the world economy are hoping to return to business as usual or at least as close to it as they can manage.

Unfortunately, the supply chain has not fully recovered. Worse — shortages of many necessary components may increase at the same time businesses are overrun with a deluge of too much stock. The result is global anxiety about the supplies that companies need to do their jobs. This is true almost everywhere…including the electric vehicle industry.

A World That Wants EVs

Other businesses have already covered how the supply chain crisis is affecting the EV market itself. The lithium shortage, in particular, is a huge worry, as lithium is a necessary component of the batteries that make EVs run. But there’s another issue that’s just as worrying: shortages of EV chargers.

Many countries (the United States, especially) have voiced interest in dotting their landscapes with EV charging infrastructure to help encourage the adoption of green vehicles. President Biden recently announced a $5 billion plan to do just that. But those are plans that may have to go on hold, as the very supply chain issues that hurt every other industry devastate EV chargers. This is especially true of level 3 chargers — dubbed direct current fast chargers (DCFC).

Technically speaking, DCFCs include any rapidly charging station that uses direct current. While there are chargers inside this group outside of “level 3” chargers (including the new level 4 chargers), the overwhelming majority, at the moment, are level 3 chargers. In any case, level 3 chargers are a subgroup of DCFCs. As such, anything that affects the latter will affect the former.

While there are many factors involved in this, the most relevant is the supply of a single, crucial component: semiconductors.

Semiconductors: The Core of the Digital Age

Semiconductors, more than perhaps any other technological innovation, are responsible for our digital world. We won’t go into the technological and engineering aspects, but suffice it to say, semiconductors are as necessary for electronics as flour is for bread.

And unfortunately, semiconductors are among the most hard-hit resources in the supply chain crisis. In fact, googling “supply chain” will likely give you an article devoted to the semiconductor shortage on the first page. The U.S. Department of Commerce has a page dedicated to it, and other outlets are concerned, specifically, with its impact on the car market.

Semiconductors and EV Chargers

By their very nature, EV chargers are stellar pieces of technology, as are the electric vehicles they charge. The problem is that they’re much more reliant on semiconductors than are, say, gas stations. Worse: Semiconductors aren’t just used in EV chargers and vehicles. They’re everywhere, from the gaming systems that saw a huge spike in demand during the pandemic to the smartphone you may be reading this on.

We live in a digital age, and the few semiconductors we have are what power it.

As such, there are many other devices that will take priority over EV chargers when the supply of semiconductors runs low.

A Possible Solution

However, there is a potential solution to this problem: switching to a different kind of semiconductor. The overwhelming majority of semiconductors are made of silicon, which is part of the shortage. But the EV industry is already looking at an alternative: SiC (silicon carbide) and GaN (gallium nitride). These two materials have both been shown to be more effective semiconductors for EV chargers and are less impacted by the supply chain shortage.

Some Problems

But there are three problems. The first is that these chips are more expensive. Because of this, they’re usually reserved for level 3 chargers.

The last problem is anticipatory. As various industries struggle with the supply chain crisis and shortage of semiconductors, they may be forced to look for alternatives. At which point, they’ll probably shift toward these new kinds of semiconductors. Demand will quickly outpace supply once more, no matter how much manufacturers try to keep up. The optimistic scenario says that GaN and SiC semiconductors will be able to stave off the shortage long enough for others to catch up and resolve the problem. But optimistic planning can kill a business. And even so, for the EV charging manufacturers that are increasingly looking at GaN and SiC as their primary choice for level 3 chargers, it could result in a one-two punch to their supply.

What Can You Do?

So what can a responsible business owner interested in getting EV chargers (especially level 3 chargers) do to prepare?

We have good news and bad news on that front. The bad news is that none of us can fully predict changes in the supply chain or other upsets that could further disrupt it. The best we can do is try to be attentive and flexible.

The good news is that GaN chips and the like have roughly a 12-week lead time. The easy solution for any business is to get ahead of the curve and act now, instead of waiting for the problem to get worse. EV Connect has certified multiple stations that are powered by our management software. If you would like to learn more, contact us today!