Following an all-time high in the field of renewables, Semikron CEO Harald Jäger has put the company back on course. Besides innovative module concepts and the success of Semikron inverters for the electric and hybrid electric bus market, Semikron is now shifting its focus back to the major expansion of its product range.

2015 would appear to be going well for many. Can this be said for Semikron, too? What are your turnover targets and how is your turnover distributed?

Harald Jäger: After closing at around 480 million euro last year, we have raised our target to 500 million euros for 2015. This is less than when the field of renewables was booming but the past two years have seen us stabilize at a very good level. As to the distribution, more than half our turnover still comes from European markets, although Semikron has had an international focus from the very beginning. We opened a production site in Brazil as early as the 1960s, for example. Today, around 35 percent of our turnover is generated in Asia and 11 percent in the Americas, bearing in mind, though, that a considerable proportion of the Asian turnover is based on designs from the USA. Semikron has also had its own production site in China for ten years now.

The wind energy boom in China was one of the reasons for the high turnover figures. The government then stepped in and put the brakes on this. How do you see the renewables market in China?

Around half our turnover traditionally comes from industrial motor drive applications and UPS systems. Renewables now account for just over 20 percent. A few years ago, renewables made up one third of the total turnover. We have weathered the market corrections in the wind sector well. Today, 38 percent of newly installed wind power capacity worldwide is based on Semikron solutions. One of the main reasons for this might be that our customers have high-power IPMs such as our SKiiP, stacks or modules to choose between, depending on their requirements. It’s also important that we establish ourselves as a reliable partner for innovative customers in China, too–and we’ve succeeded in doing just that.

Solar inverter manufacturers are also among your customers. What’s the situation in the solar energy sector?

Solar power business has gone truly international over the last few years. This is where our long-standing position and wealth of experience come into play. One example of this is the recent dynamic development in the solar energy sector in India. If the Modi government’s plans are followed through, even in part, this will translate into considerable demand for power electronic components from Semikron. We are following the market development very closely from our offices in Mumbai and are well-equipped to deal with growth in this sector.

Approximately half your turnover is generated in Europe. To what extent has your business been affected by developments in the US Dollar to Euro exchange rates over the past one and half years?

If you take our product exports, the developments of the past two years have served us well and given us clear procurement advantages. All in all, I would say that these developments have brought about more benefits than damage.

The Federal Reserve recently decided not to raise interest rates in the USA. Does this mean that by 2016 cheap money will become available once again for investments in infrastructure and energy technology?

Interest levels have always been an important economic policy instrument. What the real economic effects of this will be is anyone’s guess. What can be said is that this decision might well affect projects with unsecured financing. If these low interest rates stay, my assumption is that we won’t be seeing any major unexpected demand fluctuations before the end of 2016.

Can we expect to see more expansion at the Nuremberg headquarters? Or will you be focussing mainly on the development and production sites abroad?

Around 1300 people are currently employed at the Nuremberg headquarters. There is still some room for innovative production lines. Many of the new standard modules, will go through Semikron Slovakia. Our Nuremberg plant will, however, remain the head office for the entire group. At the moment, we are very happy with how things are in our 6-inch chip manufacturing, but we are not planning any other major investments into our own semiconductor manufacturing activities. Instead, we are focussing more on R&D for new solutions in the areas of packaging and automation. One of Semikron’s pioneering achievements is the introduction of sintering in power electronic modules with first modules offered already in 2007. And we will continue to invest in that. We also plan to expand our core competencies in the area of SKAI inverter systems for bus and utility vehicles. At the moment, the biggest part of our turnover with the SKAI platform is unquestionably generated in the rapidly growing Chinese market.

The number of firms offering wide-bandgap materials such as SiC and GaN is on the rise. To what extent has the integration of these technologies in Semikron solutions been successful?

For SiC players, our substantial purchasing volumes make us very attractive as a customer. Simply replacing IGBTs by SiC chips in a standard power electronic module cannot leverage the full potential of this material. That’s why our focus for SiC modules centres on solutions that cannot be achieved using conventional module designs. We do have the production processes needed for reliable, extremely low-inductance module designs. The high SiC chip costs means today it only makes sense to use these modules in places where the system advantages deliver real added value to the customer. In light of this, I assume it will take some years before full SiC modules are the norm in standard inverters.

How do you rate the intense work being done on GaN as a semiconductor material?

Much has happened in the past six months. As far as potential goes, I see GaN as being best suited for faster switching solar inverter and UPS applications. We are in touch with a number of manufacturers and are also working on the development of solutions that would be suitable for GaN. As with SiC, here, too, it is not simply a matter of substituting the materials. In fact, the only way to fully utilize the potential that GaN has is to incorporate this material into the system approach of the inverter solution.

Semikron seems to be moving away from its position as a specialist towards more of a broadline approach. Why have you decided to go down this path?

Semikron is still very much a specialist for innovative power electronic products and technologies. This is vital for the development of affordable and reliable components and modules. On the other hand, there is an ever increasing demand for interchangeable standard products on the market today. This is an absolutely natural effect in an ever growing demand-driven market. At Semikron, we rose to the challenge and, over the past two or three years, we performed a much welcomed expansion of our portfolio. We have better chances of doing business with customers if we have both single-source products and standard products in our range. So, yes, we are indeed gradually becoming a broadline or “full-line” supplier, while continuing to focus on delivering professional custom or single-source solutions at the same time.

In the past Semikron has worked closely with Magna on automotive projects. Are automotive applications still one of your main focuses?

Semikron is still strongly working on automotive solutions We no longer do inverter systems for use in electric or hybrid electric passenger vehicles– Semikron just isn’t a big enough player in this area for customers to use us as their tier 1 supplier. Instead, our product range includes a number of sintered modules which have proven successful in both Europe and China. We have been rather successful with our inverter systems for electric and hybrid electric buses. The figures here are of course nowhere near those for mass produced passenger cars, but they have given us a clear boost in turnover, not to mention the huge potential in this area. Bus and utility vehicle OEMs, and system integrators are taking advantage of our economies of scale and approved series production lines. This is one area where we are able to draw on the entire span of competencies that Semikron has. This is why the make-or-buy decision often goes in Semikron’s favour.

Another area where you are working with cooperation partners is electronic housing technology, which has developed considerably in recent years. Is this set to continue?

We are very much open to the joint ABB/Siemens open-source initiative presented here recently that centres on power electronic modules for MV applications in the 50 to 500 kW range. Here, the housing shape, dimensions and interface between DC link and driver electronics are pre-defined, while circuit concepts and packaging vary from manufacturer to manufacturer. This ultimately means the customer can opt to use standard components which have very different performance and reliability characteristics, depending on the manufacturer. This initiative is one that definitely has our full backing.

Germany is currently facing major challenges due to the influx of refugees. At the moment there is talk of integrating the refugees into the labour market. Do you see this as a possible solution to Germany’s shortage of qualified workers?

Our international orientation can be seen in the many different nationalities among our employees. For refugees to enter the labour market, however, sufficient German language skills are a must. This huge influx of refugees is certain to bring about various opportunities, but we have yet to look into what this might mean for us as a company. The first step is to establish contact with the relevant authorities in Nuremberg and take it from there. Perhaps I will be able to be more specific on this matter by the the end of the year.