LED industry in Guangdong or usher in "U" type reversal

Look outside is the Blue Ocean, go in and see the Red Sea. In a word, the current situation of LED lighting industry is described.

Guangdong is a global LED manufacturing base and its production capacity exceeds half of the national production capacity. As the LED market is mainly concentrated in Europe and the United States, Europe and the United States economic downturn, making overseas orders fell sharply this year, LED companies in Guangdong Province had to tighten their belts for the winter, calling for the launch of the domestic market as soon as possible a wave of waves higher than a wave.

On May 16, the State Council discussed the adoption of the “Twelfth Five-Year Plan” of the National Basic Public Service System, which provided 2.2 billion yuan in subsidies for the promotion of LED lighting.

On May 28th, Guangdong Province held a work conference to promote the application of LED lighting products, and proposed to use demonstration projects as a breakthrough point to popularize LED public lighting within three years.

Policy helpers have extended their reach in time. This is undoubtedly a stimulant for the troubled LED green lighting industry.

A number of LED companies in Guangdong in charge of an interview with reporters, said that under the government support policy, the domestic LED market is expected to really start, Guangdong LED industry is expected to usher in "U" type reversal.

Demand in overseas markets

Before meeting to drink red wine, one by one, and now meet and drink coffee, are a look of glorious Guangdong LED lighting products, the main market concentrated in Europe and the United States, due to strong demand for LED lighting products in Europe and the United States market in previous years, has attracted many companies have entered the LED The lighting industry, for a time, LED industry blossomed in Guangdong, and was listed as one of the three strategic emerging industries that Guangdong has focused on developing.

However, the US financial tsunami and the subsequent European debt crisis have made the European and American economies stagnant, and demand for LEDs has also begun to decline. The transformation of this market environment has caused many LED companies in Guangdong to be at a loss.

“This year, LED orders in Europe and the United States have generally fallen by 30% or 40%, making LED businesses whose main export business is facing great difficulties.” Guan Xudong, Managing Director, Audi General Lighting (Guangzhou) Co., Ltd. (AD Lighting) In an interview with reporters revealed.

"This is not a case, but the industry normal." Cai Yanhui, chairman of Shenzhen Baochengxin Optoelectronics Technology Co., Ltd., told reporters that the market situation in Europe and America this year is particularly grim, orders have been reduced by more than 40%.

A person in charge of an LED company in Guangzhou complained that when the industry met in the past, the topic of discussion was how to expand production capacity and how to obtain more overseas orders. Now the industry people come together to discuss the most topic is how to winter.

“I used to meet and drink red wine before, and all of them were red. Now I meet people for coffee and no sugar. I'm a look of sadness.” The person in charge scoffed: “In addition to the reduction of orders, the price war is also very severe. Many companies have difficulty in cash flow. This is why customers have to keep their prices down. In order to clear inventory as quickly as possible, LED companies have to beat down their teeth and blood."

The reporter learned from Shenzhen, Jiangmen, Zhongshan and other places that due to sharp decline in European and American orders, many small and medium-sized LED assembly companies have closed down. Although large-scale LED companies are still operating normally, they are still struggling to support the winter.

The domestic market curtain opened

The introduction of the Guangdong supportive policy will greatly stimulate the LED market demand, and promote the transition from Guangdong to the strong LED province. The industry will focus on the domestic market and hope to start the domestic market as soon as possible.

“LED lighting is green and is the trend!” said Pan Wenbo, the founder of Guangzhou International Lighting Exhibition and Dean of the Guangya Lighting Research Institute. “If China’s LED lighting industry missed development opportunities due to policy deficiencies, it would be in the future international competition. Will be passively beaten."

In order to promote the development of the LED industry, a series of supporting policies have been introduced one after another in recent years, making LED industry people see the dawn.

On May 28th, Guangdong Province held a work conference to promote the use of LED lighting products. The "Guangdong Province's Implementation Plan for Promoting the Use of LED Lighting Products" was formally introduced.

Li Xinghua, director of the Department of Science and Technology of Guangdong Province, said that Guangdong Province has set up LED application demonstration projects as a breakthrough for the development of the LED industry. Strive to popularize LED public lighting for three years, drive the whole society to popularize LED lighting, and pull the LED industry of the province to achieve an annual output value of more than 500 billion yuan at the end of the “Twelfth Five-Year Plan” period.

According to the requirements of the “implementation plan”, LED lighting products shall be used in lighting projects in new roads, public places, government agencies, state-owned enterprises and institutions, as well as new areas planned for construction. The original project using non-LED lighting products will be completed in phases within three years, that is, by the end of 2014, while the Pearl River Delta region will strive to complete by the end of 2013.

Zhou Guangyu, chairman of Guangzhou Guangwei Lighting Technology Co., Ltd., stated that “the support policy announced at this conference has a landmark significance for the LED industry in Guangdong Province and will promote the rapid development of LED companies in Guangdong and even in China.”

Guan Xudong also pointed out that the introduction of related support policies is a major positive for Guangdong's LED industry. "The launch of the domestic and provincial markets will greatly stimulate the LED market demand and promote Guangdong's transformation from a large LED province to a strong LED province."

However, people in the business community also worried that Guan Xudong pointed directly at: “If support policies are not implemented properly, are not standardized, and are not transparent, it is very likely that the companies that were supposed to be eliminated by the market will come back to life and become hidden dangers in the development of the industry.”

Attractive prospects for the civil market

Phase out of incandescent lamps will form a long-term benefit for the LED lighting industry. The market scale will reach several hundred billion yuan. As Li Xinghua said, the application demonstration project is only a breakthrough in driving the development of the LED industry, and the market really needs an outbreak and needs a civil market. start up.

It is reported that at present, domestic civilian lighting is mainly in the market of incandescent lamps and energy-saving lamps. LED lighting is difficult to be accepted by consumers because of its high price. Data show that there are currently about 15 billion incandescent lamps in the country, with annual production and sales of 3.85 billion and 1.07 billion.

"The gradual elimination of incandescent lamps will form long-term benefits for the LED lighting industry and the energy-saving lamp industry. The market size formed by replacing only the existing incandescent lamps will reach several hundred billion yuan," Pan Wenbo told reporters.

Pan Wenbo pointed out that although the country has already issued the "China Roadmap for Phase-out Incandescent Lamps", there are still not many policies to implement how to subsidize LED lighting. The "Implementation Plan for Promoting the Use of LED Lighting Products in Guangdong Province," which was just introduced, supports public lighting and does not involve civil lighting.

“Compared to public works, the potential of the civil lighting market is even greater. Once the civil lighting market is really started, the LED industry in Guangdong Province will definitely lead to a 'U' reversal.”

Guan Xudong also said that although the LED industry is in a difficult period, people in the industry are still full of confidence in the future of the LED industry. “There is great potential and there are many opportunities, especially for the civilian market.”

The industry’s embarrassment for the future of the LED industry is not without objective. According to the "National 12th Five-Year Plan for Science and Technology Development", in 2015, LED lighting will account for more than 30% of the domestic general lighting market, and the output value is expected to reach 500 billion yuan. If China's LED folk lighting penetration rate reaches 80%, it will be a trillion-level market.

It is not just local companies that favor the domestic civil lighting market. International giants including Philips, Samsung, and Sharp are also eyeing the Chinese civilian LED lighting market.

The reporter learned from the organizing committee of the 17th “Guangzhou International Lighting Exhibition” (June 9-12) that will be held in 2012 that many of the world’s top 500 companies, including Philips Lighting, value this very much. The exhibition hopes to use this platform to win over customers and channel distributors to prepare for further competition in the Chinese LED lighting market.

Industry perspective

Enterprises can't just look at policies

Industry upgrading is the key

Although LED industry in Guangdong Province has developed rapidly in recent years, there are also many problems exposed. When the market is good, these problems are not obvious. Once the market is adjusted, “naked swimmers” are emerging. Nowadays, because of the declining demand in overseas markets, it is difficult for the domestic market to actually start in the short term. Many LED companies have encountered huge development bottlenecks, and many companies have had to opt out.

Guan Xudong, general manager of AD Lighting, said that the cause of the current LED industry dilemma, in addition to the economic environment, the more important is the internal cause. “The main problem is low-level competition. Everyone thinks that LED is a good thing. People from all walks of life are coming in. There is not much technical content. Only price wars are disrupted. Market order is disrupted. If there is no effective breakthrough in core technology, It is not easy for Guangdong's LED industry to develop greatly."

According to Guan Xudong, AD lighting began its transformation as early as in 2008. On the one hand, it increased technological innovation and improved product competitiveness. On the one hand, it shifted from the overseas market to the domestic market. “Two years ago, 80% of AD lighting products were exported overseas; today, 85% of AD lighting products are digested by the domestic market.”

Wang Dianyou, honorary president of the Shenzhen Semiconductor Lighting Industry Development Promotion Association, also stressed in an interview with this reporter that if companies only focus on government support policies, they do not attach importance to the quality improvement of the LED industry and the improvement of independent innovation capabilities, and how to significantly reduce costs Without reliable quality, independent intellectual property rights, and no cost reduction, it is difficult for Guangdong LED lighting industry to achieve a real breakthrough.

According to Li Xuliang, Chairman of Qinshang Photoelectricity, due to the subsidy policy introduced in Guangdong Province, energy efficiency standards will be implemented. Only those energy efficiency standards that meet the national regulations can qualify for subsidy, and the implementation of the “leader” system for energy efficiency has the advantage of technology. The high-quality large companies occupy an advantageous position. This also means that government support policies will also play a role in promoting industrial upgrading. Enterprises that do not have technological advantages will not receive government subsidies.