The way of LED development, how to deal with the market outbreak and change
In 2013, the LED industry ushered in a thriving beauty. The positive news of policy warming, full orders, and rising capital all indicate that the LED industry, which has been overshadowed by overcapacity for a long time, is expected to usher in an outbreak again. Although the industry has achieved high-speed growth, the industry pattern is still worrying. A series of problems such as diluting profits, low-price competition, and homogenization of products are still in front of LED people. The market is about to break out, how to break the bottleneck in the industry? How to break through the industry development? How should lighting companies fight the rivers and lakes?
Market recovery drives a new round of expansion
In the opening year of 2013, the Chinese government frequently introduced energy-saving and environmental protection macro-control policies, and the LED industry also took the ride, which was quite eye-catching. In addition, after the terminal market has experienced a period of induction, the commercial lighting and civilian lighting markets have also received much attention. Under the dual stimulation of policy support and market demand, LED companies have ushered in a new round of expansion.
Commercial lighting giant Foshan Lighting took the lead in firing the first shot of LED expansion. Since launching the LED production line last year, Fozhao's production capacity has increased by about 10 times, and plans to open 2,000 brand stores across the country for direct sales of LED lighting products. On May 30, the Shenzhen Jiawei Lighting LED application project with a total investment of more than 1 billion yuan held a signing ceremony. The project is a joint venture between Jiawei and Sanan Optoelectronics, covering an area of ​​300 acres, mainly engaged in the research and development, manufacturing and sales of LED application products.
Ruifeng Optoelectronics announced on the evening of July 5 that the company plans to invest its own funds of 183 million yuan for the SMDLED expansion project, thereby further enhancing the company's overall strength in the LED packaging industry, consolidating and highlighting the company's large and medium-sized LCD backlights The leading position of LED and lighting LED market segments.
Although there is still a hidden worry about overcapacity in the upstream of LED, the trend of chip price decline in the first half of 2013 has regained confidence in the upstream of LED, and major manufacturers have also accelerated the pace of expansion. Including Sanan, Huacan and Dehao Runda, there are plans to expand MOCVD machines in 2013.
Huacan Optoelectronics began to increase its efforts in the development of the lighting white chip market last year. Its new Zhangjiagang project in Suzhou, with a total investment of 1.8 billion yuan, is expected to be completed by the end of this year, and 50% of its production capacity will be released in the lighting white chip business.
Jiang Zhongyong, general manager of Hangzhou Silan Mingxin Technology Co., Ltd., said that this year will continue to expand production, the proportion of lighting chips will rise to 30% to 40%. In addition, the original lighting chip manufacturers including DHL Runda have also made great efforts to expand production.
Low price competition
In the face of the upcoming market outbreak, LED manufacturers continue to expand and do everything possible to seize the LED lighting market share, while the price war also intensifies. With the gradual opening of the third quarter, some companies have taken the lead in announcing that they will adjust the price of their lighting products across the board, with the highest drop even reaching 40%, impacting the dramatic fluctuations in LED lighting prices and causing the industry to fall into low-price competition.
Nanda Optoelectronics released an interim results announcement on the evening of July 3, and the company expects to realize a net profit attributable to shareholders of listed companies of 30 million to 38 million yuan in the first half of 2013, a year-on-year decrease of 30.57% -45.18%. The announcement stated that although the LED lighting industry has gradually "recovered" since the beginning of this year, the sales volume of products in the second quarter has increased month-on-month, but due to the fierce price competition, the sales price of the company's main MO source products has declined year-on-year, causing a year-on-year performance decline.
Wang Lianghai, vice president of Tsinghua Tongfang, revealed that the cost of LED chips in mainland China this year has fallen by 50% compared with the same period last year. Industry research experts said that in various lighting cities in China, the penetration rate of LED lighting has reached 90% this year, but LED sales accounted for only 9.6%. This year's LED price is one-third of 2011, 3-watt Led Bulbs, brand products 30 to 40 yuan, low-end only 10 to 12 yuan. "At present, market competition mainly depends on price."
The price competition in the LED lighting market can be described as unprecedented. There are also a large number of international lighting giants coveting the global LED lighting market by means of low-cost promotion. In February of this year, American Cree launched an LED bulb of less than $ 10, which not only confirmed that Cree officially entered the field of low-power LED light sources, but its low price also posed a great threat to competitors and stimulated the LED lighting industry. Countless ripples. Not only have Samsung and Cree released LED bulbs priced below US $ 15 and US $ 10, respectively, Osram recently announced the launch of products under € 10, hoping to occupy more global market share.
Although the price drop has promoted the popularity of the LED lighting market to a certain extent. However, some people in the industry worry that once low-price competition evolves into vicious competition, it will disrupt the development order of the entire industry. While reducing product quality, it will eventually cause the industry to fall into a vicious circle of large-scale loss.
Heavy prices require more quality
Looking at the moment, the new and old manufacturers are coming together, and the offensive and defensive are fierce. LED lighting has ushered in the era of the Warring States. How to successfully break through the chaotic princes' conquest of the hegemony depends on technical innovation and quality guarantee. At present, China's LED industry is in a period of rapid development. The continuous diving of prices and the opening of channels continue to stimulate the demand of the end market, and also put forward higher requirements for the brand and quality of products.
The move of "cheap market grabs" is not wise. All along, the LED lighting market has been accused of serious disordered competition, the industry is stuck in a price war quagmire, and frequent quality crises have also exposed a series of shortcomings such as domestic LED companies' production technology capabilities and product quality. At present, China's LED industry is in the period of promotion and application, but the quality of the products will not seriously affect the popularization process of LED lighting. At the same time, LED lighting manufacturers should pay more attention to the quality of products when the export situation of LED lighting fixtures is gratifying. At this stage, foreign countries have also begun to introduce technical trade measures specifically for LED lighting fixtures. If the shortcomings of quality cannot be resolved, The majority of Chinese LED companies, mainly in the export market, have brought many adverse effects.
Replacing the market at a low price should be a means of market competition, not the ultimate goal. Not only must LED companies improve production technology and improve production efficiency to reduce costs and obtain profits, they should also increase technology content, increase product value, and shift product competition from the price battlefield to achieve more comprehensive and long-term development. Occupy a favorable position in the fierce competition; the company's core strategy must be to return to the brand value, firmly grasp the bottom line of quality, in the long-term competition, seek the road of management and quality improvement, so that the products are in domestic and even international markets Occupies a place.
Nuggets differentiated market is king
Facing the current situation of overcapacity and low-price competition in the LED industry, industry insiders pointed out that the focus of attention is no longer limited to lighting functions. The added value competition of the LED lighting industry has begun. The future development direction of the LED industry will inevitably be Only by locking in new, high-quality LED lighting fixtures, taking the path of differentiated competition, and nuggeting the niche market can we successfully break through in the industry's Red Sea.
As a new-generation light source, LED's plasticity on the light source also provides a differentiated development path for many LED manufacturers. For example, in terms of smart lighting, LED overcomes the shortcomings of traditional lighting, provides greater controllable space for urban roads and home lighting, and provides more maneuverability in lighting management and terminal control. International lighting giant Philips believes that this year is the first year of smart lighting, and together with GE lighting, Osram, Panasonic, Toshiba and other international lighting companies to form a networked lighting alliance (CLA), actively seize the LED smart lighting market, and will develop wireless transmission Smart lighting.
In addition, the plant lighting market has become a niche for many LED lighting manufacturers in recent years. Everlight Electronics signed a strategic cooperation agreement with dozens of well-known international companies such as Philips Lighting of the Netherlands, Mitsubishi Chemical of Japan, Panasonic (China) Electric, Yangzi Electric, and Oulin Group. Signed a letter of intent on technical innovation and market development in the fields of LED plant lamp lighting source, industrial control, air conditioning environment control, nutrient solution preparation, etc., with a view to developing some potential special LED lighting products in this field.
At present, China's LED lighting market has fallen into a "homogeneous" competition stage. Today, as the technology becomes more mature and profits are increasingly diluted, there are still many business opportunities to be tapped in the market segment. By increasing the added value of the product and establishing a brand image, the Nuggets differentiated market not only helps companies get rid of low-cost competition, but also wins more room for development.
At present, the explosion of LED lighting applications has ushered in an unprecedented revolution in the lighting industry. As the LED lighting battlefield attracting global attention, competition in the Chinese market will surely become more intense. Facing the huge business opportunities that broke out in advance in the market, LED lighting companies should seize timely strategic opportunities, fill shortcomings, build their core competitiveness, get rid of the Red Sea competition, and seize the right to speak in the international LED market.
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