Trade Resources Market View China LED Industry's Each Link Characteristics

China LED Industry's Each Link Characteristics

Upstream Epitaxial Chips

Upstream epitaxial chips at the growth stage, but the large capital demand, access to the strength and fairly, industry urgency horizontal consolidation is not high LED epitaxial wafer and chip, about 70% of industry profits, the LED chip companies in mainland China for about 60 or so (most of the enterprises during the construction stage), started late, the scale is not big enough, the biggest LED chip companies annual production about RMB 3, the average annual output value in 1 to 2 $each. LED packaging components in 50% depends on the performance of the LED chip, LED packaging companies to the current domestic small and medium size chips most choose domestic brands, the chip performance of domestic brands and foreign brands of a smaller gap has good cost performance. Part of the chip manufacturer product performance has been used, with foreign brands by encapsulating technology, has been able to meet the needs of many high-end applications.

Upstream epitaxy chip sector investment, lack of professional and technical personnel to compare, the investment risk is bigger, the number less, has the rate of return on investment enterprises is not high, integration is difficult, and in the field have not developed to the mature stage of the competition, the industry is the integration of the demand is not high, the horizontal integration of the whole industry chain in the field of promoting effect is not big.

Middle Assembly

\Middle assembly field, the products the same, competition is big, horizontal integration demand urgently In the LED industry chain is LED encapsulation, which forms a connecting link between the preceding and the whole industrial chain plays an incomparable role. Based on the LED device is widely used in all kinds of application products LED device, such as a large LED display, LED back light liquid crystal display, LED lighting lamps and lanterns, LED traffic lights and car lights, LED devices in the application on the total product cost accounts for 40% to 70%, and the various properties of LED application products tend to be more than 70% is determined by the performance of LED devices.

China is LED encapsulation powers, it is estimated that 80% of the world in the number of LED device packaging concentrated in China, distribution in the us, Taiwan, Hong Kong, domestic packaging enterprises. Over the past five years, foreign LED packaging companies constantly moved to the mainland, in the domestic packaging enterprises growing development, technology continues to mature and innovation. In the field of mid-range LED device packaging, LED packaging enterprises in China's overall market share is higher, in the field of high-end LED device packaging, some Chinese enterprises have larger breakthrough.

But in the middle as a whole is characterized by low barriers to entry, in the field of packaging enterprises small in scale, quantity, market competition is increasingly fierce, orders are vital to the survival and development of the enterprise, most firms adopt low price competition strategy, lack of basic guarantee product quality. LED packaging enterprises in China to achieve fast and efficient development, must strengthen in the LED packaging technology r&d investment in the research area, make up the gap between Chinese LED packaging technology and foreign, by expanding the scale at the same time, improve product grade. Implement the strategy, by their own accumulation and strength alone is difficult to effective implementation, need with the power of the capital market to mergers and acquisitions are horizontal and downward vertical integration.

Downstream Applications

Downstream applications the same enterprise, competition is big, the future will develop polarization According to experts predict that the LED application products will develop polarization, general-purpose LED application products, such as outdoor landscape lighting, indoor decorative lighting will be merged with the LED packaging companies developing trend of specialization of no thermal radiation light LED floodlight products such as military, medical, therapy lamp, sterilization lamp, floodlight for crops and flowers, a biological special lights, and solar photovoltaic cells combined with special LED lights according to their respective characteristics of independent development, in product development, design and production process on the present specialization and division of labor refinement, etc.

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Each Link Characteristics of China LED Industry