Looking ahead to 2013, the government of mainland development of LED remains firm attitude. To sift out incandescent road map will full implement, coupled with the positive promotion of the industry in the path end, all will contribute to the mainland LED industry stable growth; but on the growth behind, it is inevitably competed for the market between vendors, to expand more intense price path and the war for talent.

LED industry has bid farewell to high profit era on the mainland manufacturers, how to maintain and expand its own profit is a manufacturer of immediate problems. Overall, “competition and cooperation, price and enhance corporate profits will be the thematic in 2013 mainland LED industry; industry chain trend, it will surround the epitaxial wafer, power devices, graphical substrate, pathway, LED back light applications such as the five major issues to develop.

1, epitaxial wafer increasing, price war detonate

The riders pick up in the first half of 2012 bring confidence in the mainland LED epitaxial wafer fab equipment purchase orders to be shelved, which led to re-put on the agenda. Those un-installed equipment have also entered the operation. As of the end of October 2012, the number of mainland MOCVD machine is 823 units. On capacity, the total capacity of the mainland LED wafer production line 2-inch epitaxial wafers, has reached 4,022 ten thousand / year. Capacity utilization in the part of the equipment is not yet complete assembly. But it is still lack of talent with weak market demand and other factors, the average remained at 65%.

Although each district launched LED epitaxial wafer project has resulted in the mainland chip pile up in excess of requirement, but optimistic about the future of the size of the market, still have the manufacturers continue in 2012 in mainland investment LED Factory epitaxial wafer project. The larger Guangzhou Jingxin ( plans to introduce 60 MOCVD ), Foshan Qili photoelectric ( plans to introduce 20 MOCVD production lines and supporting the wafer production equipment ) and Foshan country star photoelectric LED epitaxial wafer project ( plans to introduce 50 MOCVD ).

It is not difficult to predict the 2013 mainland manufacturers in the market release more LED chip, coupled with the mainland manufacturers chips are mostly concentrated in the low-level, so for mainland firms specializing in price war is bound to set off a new competition.

At present, the United States and the EU and other developed countries have the core technology and patents in global LED industry, but we are lack of core technology and patents, at the same time there is no unified standard, cooperative price; in addition, the product price confusion, quality is uneven. According to the insiders, currently, the LED industry has been showing a Warlords.

Industrial investment in boom season

LED is capable of converting electrical energy into light energy of the semiconductor, as the world’s most popular new generation light source, this was listed as one of 7 strategic emerging industry, its enormous opportunities attract various capital.

According to public data shows, at present our country LED manufacturer is more than 8000, and every year hundreds of consummate about 1000 speed continues is increasing.

The reporter learns, nearly half a year, a total of 8 domestic home LED industry company is appearing on the market successfully, of which 6 gem landing, The speed showing in the market is astonishing, last year LED company has 7. On the other hand, in recent years, the domestic small and medium-sized enterprise is failed. In Shenzhen, failure of LED lighting enterprises more than 80, Guangdong Foshan, nearly a LED lighting business, Dongguan, Zhongshan LED lighting enterprise is in failure wave in 2011.

At the same time, foreign capital is in China to get ready for battle. A few days ago, Taiwan East Bay photoelectric Group invested $25000000 in led tube light optoelectronic devices production projects, in Beijing digital television industry park officially started construction, the future will supply the region of North China LED lighting. In addition, this year May, OSRAM signed with Wuxi, in the new local LED assembly plant, which is expected to complete and put into production by the end of 2013, the main LED chip package casing. Following the innovation center in Chengdu formal operation, GE lighting innovation center was also established in xi’an.

Domestic LED industry started in the 1970s. After nearly 40 years of development, it has been the formation of the national semiconductor lighting industrial bases in Shanghai, Dalian, Nanchang, Xiamen, Shenzhen, Yangzhou and Shijiazhuang. The products are widely used in landscape lighting and general lighting. At present, China has become the world’s largest lighting appliances producer and second largest exporter of lighting appliances. As of the end of 2011, China had more than 3,000 LED enterprises, of which only 140 billion in annual output value. However, in these 140 companies, no one business annual sales have exceed 1 billion yuan, there are only few only a handful of the who exceed more than 500 million yuan.

What makes the Chinese LED industry difficult to forward? The reason, one the industry is the lack of authoritative industry technology, second, corporate R & D is mainly concentrated in the downstream areas of application, in the upper and middle reaches of the R & D investment is relatively small. Large foreign companies and China’s Taiwan region in some companies have monopolized most of the LED core technology, so mainland enterprises can only be turned to look at low-tech downstream applications market.

China’s LED industry, except the core technology is less competitive, Combination loose is also a major factor restricting its development. The top three who own patent are focused on research institutes, Chinese Academy of Sciences, the Institute of Physics and Beijing University of Technology; In the areas of the chip, the top three are the Chinese Academy of Sciences Semiconductors, Beijing University and Peking University. Compared with research institutions, more domestic enterprises apply for utility model patents.

Facing the competitors “Eyeing”, domestic enterprises should be hard to practice “internal strength”. Primarily,  increase innovation, focusing on research and development one that can be widely accepted by the market and recognized the new technology; followed by, cooperate with foreign companies. it should be based on the digestion and absorption of foreign advanced technology, strengthen the imitative innovation to improve core patents to competitors, to improve its technical effect;

In short, China’s LED industry business must attach importance to the early accumulation of intellectual property, and to learn to use science and technology to arm themselves, and use of the patent to explore the domestic and international markets, and turned the “trap” into a good led tunnel light  market prospects, in order to fly higher-and farther.

The actual demand is much more than this figure, “mainland China in 2009 will require 1.4 million and 2.4 million global demand, the next large market potential is evident. Some even boldly predicted; since 2013, China’s LED production value will reach more than $ 100 billion, let aside the amount of numbers, but this industry, as long as it is able to break through the “high-end chip R & D of core technology bottleneck, our energy saving and the goal of building a green city is able to achieve.

LED is short for semiconductor lighting. It is based on a solid state light source of the semiconductor chip for the material, relying on the electron-hole recombination, and convert electrical energy into light energy efficiency is as high as 80% or more. Olympic venues under construction LED technology has been widely used as representatives of independent innovation.

It is understood that the LED’s energy consumption is only 10% of incandescent and fluorescent lamps is 30%; it uses solid package, the service life is up to 50,000 hours, 10 times is the incandescent 100 times fluorescent in led industry, it does not require the use of glass vacuum packaging and does not produce toxic side effects and mercury pollution.

China is the world’s second-largest power country. The total power generation in 2007 was 3.2559 trillion kwh, the lighting electricity up to 390 billion kwh, equivalent to the total electricity consumption in the United Kingdom for one year.

Since the 1990s, the main producing countries of the energy-saving lamps in the country vigorously popularize to use in China,while energy-saving lamps that China made are mainly for export, the domestic penetration is not high. The data show that the production of energy-saving lamps in China in 2003 to 1 billion, accounting for 70% of the market share of world sales, domestic sales of only 350 million.

According to experts, since 2007, in North America, Australia, legislation to ban the use of incandescent lamps. EU Summit to reach an agreement in the spring of 2007, which requires EU countries to phase out incandescent in led industry.

With the strong support and promote the application of LED introduction of national standards and national farewell Edison era is just around the corner, then people will spend a clean and green, led high bay light pollution, no radiation and toxic side effects of new high-quality light source.

2009 was destined a China ” LED “, in April, Ministry of national science and Technology launched the ” Ten City ” plan “. In July 24th, the national development and Reform Commission and the United Nations Development Programme ( UNDP ), the global environment facility ( GEF ) cooperation ” Chinese phasing out the incandescent lamp, energy saving lamps promotion ” project signing ceremony was held in Beijing. United Nations Secretary-General Ban Ki-moon, national hair changes appoint vice director Jie Zhenhua, Chinese Ambassador Zhang Yesui, Li Yong of undersecretary of Ministry of finance, the United Nations Development Programme ( UNDP ) chief representative of China Ma Heli attended the signing ceremony. This marks China’s green lighting  usher into a new level to the international cooperation.

In fact, the State Ministry of Finance in 2008, begin to execute ” the promotion of efficient lighting products financial subsidies to fund management Interim Measures ” have LED semiconductor lighting products included in the scope of subsidies, then the corresponding supporting tax policies have been introduced. This is a industry unprecedented support. By 2008 Beijing Olympic LED application continues to have a fever, and the 2010 World Exposition in Shanghai, Guangzhou Asian Games and the 2011 Shenzhen World University Games coming soon, driven by the large LED billboard, architectural landscape lighting application opportunities, also it was 2009 LED industry focus.

The support of the government, the national energy-saving emission reduction policies led will be the driving force for sustainable development of LED road lighting and led tunnel light market, in addition to international exhibition, event promotion, governments large purchases and LED street demonstration program implementation, and LED street lamp in LED industry where the specification is made in succession, expects 2009 global LED street lamp market penetration will break through 1%, and began to enter rapid growth period.

On how to carry out the “Ten City ” ” LED pilot demonstrative city, Gao Xinsi of Ministry of science and technology to business offices original proposed scheme the initial idea is: through LED in municipal lighting demonstration project as the carrier, to choose 10 city to promote the application of LED lighting (including lamps, tunnel lights, Metro and led tunnel light rail, gas station, underground parking and other functional lighting) 10000 sets or above. According to LED product technical efficiency, energy conservation effect and the economic and social benefits, taken after subsidies, subsidies, but right now it still has not issued a document.

Last week Shenzhen ‘s optoelectronic (hereinafter referred to as the ” Lehman” ) for emergency decided to move to Huizhou base, part of staff for separations caused compensation dispute. Insider, That Lehman was eager to move plant expansion is due to its profit situation continued to deteriorate. In fact, many LED panel light companies in order to reduce and the decline in net profit struggling. The industry is expected, the next two years will become the LED industry bubble burst period.

Expansion of self-help lead the labor conflict

It is understood that, in 2011, Lehman fund-raising 605 million yuan (below) to establish LED Industrial Park, of which 143 million yuan for the expansion project of investment in high-brightness LED packaging devices, high-end LED display screen and LED lighting energy-saving products expansion project. The Huizhou base is the one of which raise investment project. Informed sources said, the reason why they rush to relocate due to the dual pressures of small-scale and low gross profit, and so resulted in this situation.

As one of the first landed on the GEM LED enterprises, the scale of Lehman does not outstanding. And the recent two years show that the gross profit margin declining. In the first half of this year, the company’s revenue was 148 million yuan, a year-on-year growth of 21.50%, but the gross profit margin slipped to a low point, only 13.67%. One industry analysts said, regardless of size and gross profit margin, Lehman are much lower than the peer. In this year’s market environment, the pressure to survive become greater.

LED industry will welcome the bubble burst period

In fact, in the scale and profit struggling, there are far more than the Lehman companies. In the half years, number of orders in most companies have a sharp decline. LED lighting company in Shenzhen, a foreign trade manager, said: “The first three quarters of exports fell by nearly half.” Shenzhen Semiconductor Lighting Promotion Council Deputy Secretary-General Baoen Zhong more bluntly: “This year is the worst year.”

However, in contrast with the closure of small businesses, it is a contrarian growth of some of the leading enterprises. According to Hsu Chen Shen introduced, He believes that, from last year to this year, “Mainland in a few years ago invest more foam economy, so in the the next two years it is foam centralized broken period.” Hsu Chen Shen said.