Author: Cai Lu
Servo systems and inverters hold a pivotal position in the wave of domestic substitution in industrial automation. They connect the performance breakthroughs of upstream semiconductor components with the intelligent upgrades of downstream manufacturing scenarios. They serve not only as the core execution terminals for achieving high-precision control and flexible speed regulation of equipment, but also as the core engine driving the entire industrial control supply chain to break free from external dependencies and leap towards the high-end segment.
In the past, domestic core power components relied heavily on imports for a long time, which not only drove up the manufacturing costs of complete machine products but also left supply chain security and delivery stability in a completely passive position. Today, domestic power component manufacturers and complete machine enterprises for servos and inverters have initiated deep collaboration. From joint definition of early-stage requirements and co-development of core technologies to long-term operating condition verification in complex industrial sites in the later stages, they are gradually resolving the industry pain point of "fighting alone." The industrial synergy model of "domestic complete machines + domestic components" is arriving.
01. Dual-Track Parallelism: Market Resonance Between Servos and Inverters
As the most core motion control component in industrial automation, a servo system is essentially an automatic control system operating on closed-loop feedback logic. Given a target command, it enables the position, speed, or torque of the controlled object to accurately follow throughout the process without significant deviation. Its core mission is to amplify, convert, and finely regulate the input power, ultimately ensuring that the torque, speed, and position control output by the driving device are flexibly adjustable and precisely controllable.
The structure of this system is not complex, consisting of three core components: servo drives, servo motors, and encoders. Among them, the servo drive is the "brain" of the entire system. After receiving external control commands, it dynamically adjusts the motor current to achieve closed-loop control in three dimensions: position, speed, and torque. The servo motor acts as the "hands and feet" of the system, responsible for the final motion output. Currently, the industry widely adopts permanent magnet synchronous motors to achieve higher power density and operational energy efficiency. The encoder serves as the "eyes" of the system, feeding back the actual operating position of the motor to the drive in real time. Mainstream products are divided into two categories: incremental encoders and absolute encoders.
In recent years, driven by the dual forces of intelligent manufacturing upgrades and the boom in emerging industries, the servo system market has not only achieved a significant recovery but also promoted a deep structural reconstruction of value distribution across the entire supply chain, fueled by the rapid increase in the domestic substitution rate and continuous breakthroughs in local technologies. According to the "2026 China General Servo Product Market White Paper" released by GW Consulting, the market size of China's general servo market rebounded strongly to CNY 22.96 billion in 2025. The overall market share of domestic brands exceeded 60% for the first time, achieving a leapfrog growth compared to the level of less than 50% five years ago. In the past, Japanese brands long occupied half of the domestic servo market by virtue of their first-mover advantage. Today, this pattern, which has lasted for many years, has been completely reversed. Their market share has plummeted from over 50% before 2020 to about 26% currently, and their industry discourse power is continuously weakening.
As a key hub in the drive layer of industrial automation, the domestic substitution process of inverters has also yielded remarkable results. Especially in the widely used low-voltage inverter sector, domestic brands have gradually taken market dominance through technological innovation, achieving high-quality localized supply. According to the "2026 China Low-Voltage Inverter Market White Paper" released by GW Consulting, the market size of China's low-voltage inverter market in 2025 was approximately CNY 29.27 billion, and its market volume firmly ranks at the forefront of industrial control sub-sectors.
In simple terms, a low-voltage inverter is a type of AC motor drive device with a voltage level below 690V. It achieves precise control of the motor speed by adjusting the frequency and voltage of the power supply. Looking back a decade ago, the domestic inverter market was still dominated by foreign brands. International giants such as ABB and Siemens built extremely high competitive barriers with their long-term technological advantages, leaving almost no room for local enterprises to gain a foothold. Today, the industry has ushered in a historic turning point. In 2025, the market share of local brands climbed to 46%, achieving leapfrog growth. This marks that Chinese manufacturers have successfully broken the long-term monopoly of foreign capital and reshaped the competitive landscape of the domestic low-voltage inverter market.
The simultaneous rise of the two major tracks of servos and inverters has directly driven the continuous expansion of upstream power component demand. This demand expansion, jointly driven by the two core industrial control components, is not a fragmented increment brought by the growth of a single track. Instead, it is a systematic industrial resonance transmitted reversely from the downstream complete machine end to the upstream semiconductor link after the domestic substitution of the entire industrial automation enters the deep-water zone.
02. Local Enterprises: From Single-Point Supply to Strategic Synergy
Benefiting from the systematic resonance formed by the deep binding of the upstream and downstream, the market roles of local power component manufacturers are undergoing a profound transformation. In the past, their role was "suppliers," providing components according to the specification requirements of complete machine enterprises, with price as the core competitive dimension. Now, leading enterprises are upgrading to "strategic partners," deeply participating in the product definition and R&D of complete machine enterprises.
As a local leader, Inovance relies on its comprehensive product matrix, stable performance, and localized service advantages to firmly rank first in the domestic market with an approximately 22% servo market share. It has surpassed traditional Japanese giants such as Panasonic and Yaskawa Electric, becoming a core benchmark in the domestic servo market. Delta Group, headquartered in Taiwan, China, ranks in the second tier with an approximately 9% market share. Its servo product line has formed a complete gradient from high-end multi-axis (W3) to basic models (E3/E3C). Xinje Electric, originating from traditional manufacturing, follows closely with an approximately 18% domestic share, driving the growth of its servo business through the "PLC+" solution.
The cooperation between StarPower Semiconductor and Inovance is also a typical sample of this transformation. In January 2026, StarPower Semiconductor once again won the honor of "Strategic Supplier" from Inovance. According to reports, StarPower Semiconductor deeply participates in the product R&D of Inovance, providing it with comprehensive semiconductor components and system solutions, especially customized IGBT and SiC module solutions, which significantly improve the energy efficiency ratio and system reliability, helping Inovance maintain technological leadership in fields such as industrial control and new energy. This "joint definition" cooperation model means that power component manufacturers are no longer passively receiving orders but participate in the optimization design of complete machine performance at the chip level.
Comprehensive coverage of the product matrix is the technical foundation for undertaking supporting opportunities. Silan Microelectronics advances along three main lines: silicon-based IGBTs and MOSFETs, third-generation semiconductors (SiC and GaN), and 12-inch high-end analog. Currently, the company's industrial-grade MCUs have been maturely applied in scenarios such as industrial inverters, forming an integrated product matrix of "MCU + power module + driver IC" with its IGBT/SiC power modules and gate driver ICs. Through chip-level collaborative optimization, it effectively improves system energy efficiency and reliability while reducing customers' R&D costs.
In addition, Macmic Science & Technology has also been deeply engaged in core industrial control scenarios such as inverters and servo drives for many years. Relying on profound technical accumulation and full supply chain layout capabilities, it has currently built a platform-based product system of "chips + modules" and successfully expanded its business territory to high-growth fields such as new energy power generation, NEVs, and data centers, forming a dual-wheel drive pattern of stable cash flow business and high-potential growth business.
From "selling components" to "joint definition," and from "single-point supply" to "system solutions," the role of local power component manufacturers has shifted from traditional backend supply to frontend synergy, turning the synergy of "domestic complete machines + domestic components" from a slogan into implementable industrial practice.
03. The Path of Advancement: Overcoming Three Hurdles in Industrial Upgrading
While achieving remarkable development results, the shortcomings in industrial maturity cannot be ignored.
Currently, the generational technological gap in high-end industrial control power components still exists, and the penetration rate of domestic products in the high-end market remains difficult to break through. Although local power component manufacturers have basically achieved comprehensive substitution in the low- and mid-end industrial control component track, and their product performance and delivery capabilities can fully meet the needs of mainstream scenarios, there is still a generational gap with international top giants in core categories such as high-end IGBT modules, high-precision SiC components, and high-end IPM modules required for high-end servos and high-voltage high-power inverters. Products from foreign brands still maintain obvious advantages in core indicators such as long-term operational stability, full lifecycle lifespan, high-frequency dynamic performance, and mass production consistency. Meanwhile, the core components of domestic high-end industrial control equipment still highly rely on imports today. At the same time, the mass production stability and wafer yield of local third-generation semiconductor components also have considerable room for improvement, making it temporarily difficult to adapt on a large scale to the stringent requirements of extreme working conditions in high-end industrial control scenarios. The absence in the high-end market has become the biggest shortcoming for local power component manufacturers to impact the upstream of the industry.
In addition, facing new wide-bandgap components like SiC, domestic brands still face a high-cost threshold that is difficult to quickly cross, and the progress of scaled penetration has always fallen short of market expectations. Although third-generation semiconductor components such as SiC and GaN have outstanding advantages in performance such as high voltage resistance, low loss, and high-frequency response, the preparation of upstream substrate raw materials is difficult, and the full-process production process is complex. The final mass production cost is much higher than that of mature traditional silicon-based power components. At this stage, the overall cost-performance ratio is still difficult to adapt to the large-scale popularization needs of low- and mid-end general industrial control equipment. Currently, SiC components have only achieved small-batch implementation in a few head projects of high-end servos and high-end inverters. Limited by the rigid cost pressure at the complete machine end, the mainstream product selection of the vast majority of low- and mid-end industrial control manufacturers is still dominated by mature silicon-based components. The scaled implementation speed of new power components is far lower than the general expectation of the industry previously. This cost barrier has become a core obstacle restricting the industrial control industry from upgrading to higher energy efficiency.
More importantly, the industry-wide low-price involution is also continuously squeezing the space for industrial R&D and upgrading. In the process of increasing the domestic substitution rate of industrial control complete machines, the number of local servo and inverter manufacturers has increased rapidly, and market competition has become increasingly fierce. The intensity of price competition has spread from the low-end red ocean market to mid- and high-end scenarios. The cost pressure at the complete machine end is transmitted upstream, driving the local power component industry into low-price competition and continuously narrowing the profit margin of enterprises. Since meager profits cannot support the high R&D investment required for high-end components, some enterprises have fallen into the path dependence of "valuing scale over R&D." This not only slows down the pace of overall technological upgrading but also becomes a key bottleneck restricting the local power component industry from achieving high-quality and high-end breakthroughs.
04. Conclusion
Looking back from the current industrial node, opportunities and challenges in the industrial control semiconductor track have always gone hand in hand. The acceleration of domestic substitution for servos and inverters is not a simple battle for market share, but a key leap for China's industrial automation supply chain from "complete machine breakthroughs" to "full-chain autonomy." Local power component manufacturers have long completed the role transition from "standard suppliers" passively receiving orders to "strategic partners" deeply bound with downstream complete machines, and have achieved comprehensive substitution in the low- and mid-end industrial control component market.
However, core issues such as the incomplete bridging of the high-end technological generational gap, the persistently high cost of new wide-bandgap components, and the industry-wide low-price competition continuously overdrawing the R&D space remain hurdles that need to be broken through urgently in front of the industry. Looking to the future, the second half of industrial control semiconductors is no longer a simple battle for market share, but a reshaping of the position in the global value chain. When local enterprises can define product standards through technological innovation and reconstruct the industrial pattern through ecological synergy, China's industrial control semiconductors will truly transform from "followers" to "leaders."