Lighting LED package price decline slows

According to the latest report, due to the global economic downturn and the Sino-US trade conflict, the growth rate of the global LED lighting market has slowed down markedly, which has affected the LED package output value applied in the lighting field. In 2018, China's general lighting LED packaging market scale was 5.2 billion US dollars, and the annual compound growth rate in 2018-2023 was only 3%, and the growth rate dropped significantly.

Wang Ting, an analyst at Jibang Consulting, said that due to the limited decline in the price of LED chips for first-line brands, and the profit margin of LED package manufacturers is very small, most package manufacturers are reluctant to continue to snatch them in a price-competitive manner in the case that costs cannot be reduced. Market share, and at the same time reduce the rate of production to reduce inventory pressure. Therefore, the overall price of packaging in the Chinese market in June was small, and the prices of some high-power and medium-power LED packaging products fell slightly. In the high-power segment, the average price in June fell by about 1%. In the middle power segment, the price changes mainly occurred in the 5630 LED, 0.5W and 0.2W 5630 LED product prices fell by 0.5% and 2.4% respectively.

In terms of profitability, the LED chip industry has seen a significant downward trend in the gross profit margin of the manufacturers since the third quarter of 2018. If the Chinese government subsidies are deducted, most LED chip companies are already at a loss, so there is almost no room for price reduction on the current chips.

The profitability of global LED packaging manufacturers is declining. Although the decline is not as big as that of chip makers, the profit margin of enterprises is also continuously compressed. From the recent financial data disclosed by Chinese packaging companies, the average gross profit margin of the industry is 20~25%, of which the LED gross margin of lighting LED is low, and the long-term is between 10-15%. The profit margin of the lighting LED market is lower than that. Industry average.

Therefore, for most package manufacturers, the lighting LED business is not the main driver of profit, and due to the decline in market size, the effect of replacing orders with low prices is not obvious, because competitors will continue to maintain prices. Accounting rate. Most manufacturers are more willing to develop new services, such as the Mini LED display market, including many companies including Hongli Zhihui and Zhaochi, which take the opportunity to enter the display field.