Since China’s accession into WTO, foreign investment transformed from exemplary joins into strategic development in many industries, including LED lighting industry.
Firstly, we need to comprehend the purposes of these international LED enterprises’ continuous establishing factories in Mainland. Obviously, cost will be the most essential reason. Because of the tremendous manpower advantage, China has always been the favorite in manufacturing industry all over the world. As a manufacturing, LED lights need much more manpower compared with other industries. Although the invention of automatic production line may reduce pressure to some degree, the entire production process still required a large amount of human label. Cheap Chinese labor kept these international LED enterprises low costs. Besides, foreign investors also took the complete and convenient transportation system into account. Another reason is the market advantage. There is no doubt that China will become the biggest market for LED lighting industry in the future. Building production base in Mainland can speed up the feedback between customers and manufacturers, which is really essential to establish the brand influence.
Secondly, we need to analyze the merits and demerits of domestic and international LED tubes manufacturers. Generally, international LED enterprises are more powerful in research and development area. More than 80% LED chips came from foreign LED companies in spite that more than 80% LED lighting factories are in China. Obviously, foreign companies have advanced technology while our domestic companies only can provide label.
Once we figure these problems out, comprehensively understanding the not-really-complicated lines under the superficial phenomenon, we could easily come up with solutions. However, the premise is we know which way is right to follow.
Unboubtly, technology improvement is the primary step. In order to increase the international competitions, we should have our own LED chips. Fortunately, China’s top 5 LED enterprises have transmitted their attention on this part, starting their research and development in intelligent LED lighting products area and LED chips area. Our LED manufacturers also need to put a premium on management to improve products qualities. Surely we must clear that simply competing in low-quality application market will keep our competitiveness in low levels. As a matter of fact, most of our LED lighting products are much cheaper than foreign products, but still lacking of popularity in high-end markets. These are problems cannot be solved only relied on low prices.