LED industry gradually entered maturity

In the development process of LED industry for more than ten years, the market structure and competition pattern of the industry are constantly changing. Up to now, under the dual factors of internal and external environment, the overall output value growth of the industry has gradually slowed down, and the technology of all links in the industry chain is mature. Intensification is intensified, competition is gradually stable, and the industry is gradually entering a mature stage. Under this background, innovation will become the key to the future growth of the industry.

The overall growth rate of the industry's output value declined significantly

The overall market size of China's LED industry reached 755.5 billion RMB (2018), of which the output value of LED upstream chip, midstream package and downstream application was 20 billion RMB, 100 billion RMB and 635.5 billion RMB respectively, up 4.3% and 14.3% respectively. 15.6%. In 2014-2018, the overall market size of the LED industry increased from 338.5 billion RMB to 755.5 billion RMB, with an average annual compound growth rate of 22.2%. Compared with the growth rate of more than 20% in previous years, the growth rate of LED downstream application in 2018 has slowed down remarkably. The main reasons for the slowdown in growth are: from the domestic environment, the Chinese economy is facing downward pressure and the consumption power of residents is decreasing. Insufficient domestic demand, while the market demand for real estate and automobiles in LED downstream applications is weak; from the international environment, the uncertainty of Sino-US trade war policy continues to affect the export of industrial products; from the perspective of the industry itself, the capacity structure of the LED industry excess, the industry enters the down cycle, while LED lighting replacement is close to the peak.

In the chip segment, China's LED chip market has reached a high market concentration. From the perspective of capacity distribution, the top five LED chip manufacturers in China accounted for more than 70% of the market share in 2018, and industry concentration is expected in the next year or two. It will be further improved, and the top five market share will reach 80%. In the packaging process, giant Mulinsen is far ahead of other manufacturers, and its large-scale enterprises such as Guoxing Optoelectronics, Dongshan Precision, Hongli Zhihui, Jufei Optoelectronics, Zhaochi, and Ruifeng Optoelectronics are also eyeing. The competitive advantages in production, production efficiency, yield control, supply chain management and control will continue to grow and develop in the future, and the market space of small enterprises will be compressed, and the concentration of the industry will continue to increase.

In 2018, the largest application area of ??LED in China is still general lighting, accounting for 47%, followed by landscape lighting, display, backlight and other fields. The general illumination penetration rate of LEDs has reached a peak, and the market growth is weak. Under the government's regulation of the PPP model, the degree of thermal lighting in landscape lighting projects has decreased, up 14.3% year-on-year; the LED display market is becoming increasingly saturated, and competition is fierce, but at small intervals. Driven by strong demand, it still achieved a year-on-year growth of 12.3%.