Chinese Low-Cost Competition Hits Onsemi: Czech Plant to Cut 300 Jobs
US chipmaker Onsemi announced it will lay off approximately 200-300 employees at its Rožnov pod Radhoštěm plant in the Czech Republic, primarily in the silicon carbide (SiC) wafer manufacturing division. The move is driven by Chinese suppliers, backed by government subsidies and low electricity prices, capturing the market with prices far below Western counterparts, making in-house production uneconomical. Onsemi will shift to sourcing lower-cost wafers and focus on higher-value backend processes.
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- 📰 Published: June 4, 2026 at 22:56
- 🔍 Collected: June 4, 2026 at 23:09 (13 min after Published)
- 🤖 AI Analyzed: June 6, 2026 at 15:27 (40h 17m after Collected)
(Central News Agency, Prague, 4th) US chipmaker Onsemi has announced it will lay off approximately 200 to 300 employees at its plant in Rožnov pod Radhoštěm, Czech Republic, primarily in the silicon carbide (SiC) wafer manufacturing division. According to analysis by Czech media, the main reason for the layoffs is that Chinese SiC wafer suppliers, backed by government subsidies and low electricity prices, are capturing the market with prices far below those of Western manufacturers, leading Onsemi to decide to reduce production capacity.
According to Czech tech media E15, this is another organizational adjustment by Onsemi after it cut 170 employees in the Czech Republic in 2025. However, Onsemi still plans to invest approximately 440 billion Czech koruna (approximately TWD 66.6 billion) in the Czech Republic and continues to negotiate with the Czech government for an investment subsidy of approximately 110 billion koruna (approximately TWD 16.6 billion).
The layoffs are concentrated in the SiC wafer manufacturing department. SiC wafers are considered a next-generation semiconductor material, offering higher voltage resistance, lower energy consumption, and better energy conversion efficiency compared to traditional silicon chips, and are widely used in electric vehicles, AI data centers, and industrial power systems.
Onsemi has been actively investing in the SiC wafer market in recent years and has publicly stated its ambition to become a global leader. The plant in the eastern Czech city of Rožnov pod Radhoštěm is one of its key production bases.
However, the rapid rise of China's SiC wafer industry in recent years is causing a major shock to the global market. Due to US chip export controls on China, China has accelerated the development of its own semiconductor supply chain, pouring significant resources into the SiC wafer industry.
The report indicates that Chinese companies such as Shandong Tianyue Advanced Technology Co., Ltd. and TankeBlue have significantly improved their technology and production capacity. With government subsidies and low electricity prices, they are capturing the market with prices far below those of Western manufacturers.
Industry insiders point out that the current cost for a Western manufacturer to produce one SiC wafer is approximately USD 1,200 (approximately TWD 37,790), while Chinese companies have already reduced it to around USD 400 (approximately TWD 12,596). The crystal growth process for SiC wafers requires continuous operation at around 2,300 degrees Celsius for several days, consuming a tremendous amount of energy, which is particularly disadvantageous in Europe's high electricity price environment.
Facing market changes, Onsemi's management believes that continuing to produce wafers in-house is no longer economically viable. Therefore, they have decided to reduce capacity, shift to sourcing lower-cost wafer materials from the market, and focus on higher-value-added backend processes and chip manufacturing. Although Onsemi has not explicitly stated it will purchase Chinese products, the industry generally believes that Chinese suppliers will play a more important role in the global SiC wafer supply chain in the future.
On the other hand, the Chinese market is also a significant source of revenue for Onsemi. In recent years, Onsemi has secured supply orders from Chinese electric vehicle brands NIO and Geely, and has established a presence in Shanghai to strengthen its market position.
However, analysts also point out that the current situation highlights the strategic challenges facing the European and American semiconductor industries. Over the past few decades, Western companies have transferred parts of their key supply chains to China for cost reasons. Now, China not only controls the supply of important raw materials like rare metals and specialty gases but is also expanding into core semiconductor material areas like SiC wafers. If the supply chain becomes overly concentrated in China, it could increase the risk of dependence on a single market for European and American industries. (Editor: Zhang Zhixuan) 1150604
According to Czech tech media E15, this is another organizational adjustment by Onsemi after it cut 170 employees in the Czech Republic in 2025. However, Onsemi still plans to invest approximately 440 billion Czech koruna (approximately TWD 66.6 billion) in the Czech Republic and continues to negotiate with the Czech government for an investment subsidy of approximately 110 billion koruna (approximately TWD 16.6 billion).
The layoffs are concentrated in the SiC wafer manufacturing department. SiC wafers are considered a next-generation semiconductor material, offering higher voltage resistance, lower energy consumption, and better energy conversion efficiency compared to traditional silicon chips, and are widely used in electric vehicles, AI data centers, and industrial power systems.
Onsemi has been actively investing in the SiC wafer market in recent years and has publicly stated its ambition to become a global leader. The plant in the eastern Czech city of Rožnov pod Radhoštěm is one of its key production bases.
However, the rapid rise of China's SiC wafer industry in recent years is causing a major shock to the global market. Due to US chip export controls on China, China has accelerated the development of its own semiconductor supply chain, pouring significant resources into the SiC wafer industry.
The report indicates that Chinese companies such as Shandong Tianyue Advanced Technology Co., Ltd. and TankeBlue have significantly improved their technology and production capacity. With government subsidies and low electricity prices, they are capturing the market with prices far below those of Western manufacturers.
Industry insiders point out that the current cost for a Western manufacturer to produce one SiC wafer is approximately USD 1,200 (approximately TWD 37,790), while Chinese companies have already reduced it to around USD 400 (approximately TWD 12,596). The crystal growth process for SiC wafers requires continuous operation at around 2,300 degrees Celsius for several days, consuming a tremendous amount of energy, which is particularly disadvantageous in Europe's high electricity price environment.
Facing market changes, Onsemi's management believes that continuing to produce wafers in-house is no longer economically viable. Therefore, they have decided to reduce capacity, shift to sourcing lower-cost wafer materials from the market, and focus on higher-value-added backend processes and chip manufacturing. Although Onsemi has not explicitly stated it will purchase Chinese products, the industry generally believes that Chinese suppliers will play a more important role in the global SiC wafer supply chain in the future.
On the other hand, the Chinese market is also a significant source of revenue for Onsemi. In recent years, Onsemi has secured supply orders from Chinese electric vehicle brands NIO and Geely, and has established a presence in Shanghai to strengthen its market position.
However, analysts also point out that the current situation highlights the strategic challenges facing the European and American semiconductor industries. Over the past few decades, Western companies have transferred parts of their key supply chains to China for cost reasons. Now, China not only controls the supply of important raw materials like rare metals and specialty gases but is also expanding into core semiconductor material areas like SiC wafers. If the supply chain becomes overly concentrated in China, it could increase the risk of dependence on a single market for European and American industries. (Editor: Zhang Zhixuan) 1150604
FAQ
What is a silicon carbide (SiC) wafer?
A next-generation semiconductor material offering higher voltage resistance and lower power consumption than traditional silicon, used in EVs and AI data centers.
Why can Chinese companies produce SiC wafers so cheaply?
Mainly due to Chinese government subsidies and low electricity prices. SiC wafer manufacturing requires high temperatures for long periods, making power costs a major factor.
Why is this news important?
It highlights the declining competitiveness of Western semiconductor makers and the increasing risk of supply chain dependence on China.