Investment slows down LED lighting companies wait for dawn

After experiencing a fierce expansion of production capacity and a relative surplus of production capacity, with the gradual maturation of conditions and policy support, LED lighting has a new round of market opportunities. Recently, the reporter conducted an in-depth investigation in the Pearl River Delta, the most developed area of ​​LED lighting epitaxial packaging and lighting industry in China.

The survey found that companies on the LED lighting industry chain are currently looking for their own "surveillance" direction in the face of "darkness before the dawn." It is worth noting that companies engaged in the manufacture of LED lighting terminal products may become the first beneficiaries of LED lighting market startup. The giants of domestic traditional lamps and lanterns are also poised to move forward. They are ready to transfer the huge production capacity of traditional lamps and long-term accumulation of production experience to LED lighting products. With their perfect marketing network, they want to win in the emerging LED lighting market. The corresponding market share.

As a strategic emerging industry, although the LED lighting industry seems to be "unlimited", after experiencing fierce expansion in 2010 and 2011, there is a relative surplus of production capacity. LED lighting companies are facing sharp price and profit margins. The risk of slipping. Starting in the second half of last year, some small-scale LED lighting extension and packaging companies have incurred large-scale losses.

However, according to the reporter's multi-party understanding, while the LED lighting industry experienced a great earthquake, a new round of market opportunities is also gestating. On the one hand, with the sharp decline in chip prices, the price of LED lighting terminal products has dropped to a level not far from the traditional energy-saving lamps, and LED light sources have become possible for large-scale replacement of traditional light sources. On the other hand, in November 2011, the National Development and Reform Commission issued a “roadmap to eliminate incandescent lamps,” and China's elimination of high-energy-consuming lighting products has really entered the implementation phase from the national regulatory level. On May 23, the Guangdong Provincial People's Government issued a notice requesting Guangdong Province to popularize LED lighting in the public lighting field within three years. It is expected that the LED output value of Guangdong Province will reach 500 billion yuan. In the Pearl River Delta Region, the most developed region of China's LED lighting epitaxial packaging and lighting industry, companies in the LED lighting industry chain are breaking through in different directions to prepare for the huge market demand that will soon begin.

The slowdown of investment in enterprises has turned into opportunities for industry consolidation. According to the research data of the relevant research institute at the end of May, the price of LED chips continued to decline, and the average annual decline rate was close to 40% year-on-year. The growth rate of the production capacity of epitaxial chips also dropped from 100% in 2010 to 50% in 2011. At the same time, the current domestic LCD TV production, LED TV penetration rate reached 100%, which also means that the future LED backlight market will no longer have a substantial increase in the future LED market growth will be the main driving force of the general lighting market.

According to data released by China National Semiconductor Lighting Engineering R&D and Industry Alliance, the entire LED industry already has about 3,000 companies, including less than 100 epitaxial chip companies, more than 600 packaging companies, and more than 2,000 LED application companies; The largest chip company's sales revenue is less than 1.8 billion yuan; the largest packaging company is less than 1.1 billion yuan, and the market share is less than 4%; LED lighting and lighting company sales of more than 100 million yuan less than 10% of lighting companies.

For the industry's declining profitability, a number of LED listed companies have expressed that they have been conscious of slowing the investment rate this year, and turning to seek opportunities for industry consolidation.

Substitution effects and government investment ready to go Reporters learned from many companies engaged in the production of LED terminal products that the “bitter days” of mid-to-upper-stream companies brought about a drastic drop in the cost of downstream end products. Currently, they are replacing 15W traditional daily use. Energy-saving bulbs 4WLED bulbs, the cost has dropped to less than 10 yuan, which is almost the same as the cost of 15W energy-saving light bulbs. However, compared to conventional energy-saving light bulbs, LED lighting has the obvious advantages of lower energy consumption, longer life, and better color rendering performance. Therefore, once the market is recognized, large-scale substitution effects will emerge.

In addition, the local government's policy subsidies for LED lighting are also changing significantly. After the Great Leap Forward in 2010 and 2011, the local government's fiscal subsidy policy for the production equipment in the upper and middle reaches has basically ended, and now it has turned to policy support for the substitution of traditional lamps and lanterns in the downstream. For example, Guangdong Province made it clear in its “Implementation Plan for the Promotion of the Use of LED Lighting Products” that LED lighting in the public lighting field will be popularized within three years, and LED lighting products will be required for new lighting projects invested by local government agencies and state-owned enterprises and institutions. . According to the reporter, Guangdong has already achieved LED lighting on many national highways. The first 120-high-speed road section in Shenzhen, which is the first LED lighting highway in Shenzhen, has been reconstructed.

It is understood that the commercial and daily LED lighting products of a number of listed companies have relatively strong price competitiveness with respect to traditional energy-saving lamps and have already met the conditions for market launch.

The LED lighting industry is about to be detonated by the rapidly growing demand. For LED lighting companies in the upper reaches of the industrial chain, the key is whether they can overcome the short-term overcapacity and industry integration; and for LED lighting companies manufacturing downstream terminals. , it is the question of starting early on the starting line.