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How to Achieve New LED Industry Growth through Integration

Nov 02, 2012

In the wake of successive growth patterns driven by applications of display and backlight, a third growth wave, characterized by lighting applications, is approaching. However, the industrial scale growth does not mean a promising future, rather it will face increasingly fiercer competition and more obvious industrial integration.

The LED lighting market saw some improvement in the latter half of 2012, but many manufacturers — especially small- and medium-sized enterprises — had no market competitiveness and could not produce high amounts of cost-efficient products. In terms of the global acceptability of LED products, take 1.2m LED straight lamps for example: the European and American markets can accept 110 Yuan, the Middle East and South American 60 to 70 Yuan, while Chinese market 50 to 60 Yuan. Last year 1.2m lamps were sold at the price of 180 Yuan, while this year witnessed a drop to 100 Yuan, with the gross profit staying between 20 to 30%. Therefore, for those small- and medium-sized enterprises that are inferior in core technology and sales capability, pressure from competition and survival is increasingly higher.” A foreign trade manager of a LED lighting enterprise in Shenzhen spoke bluntly about survival pressure.

The bankruptcy of JDL and Vie-led Optoelectronic Co., Ltd. was not abnormal, small and micro enterprises met recession in the market, and it is hard for them to survive at the time when the market was hit by the low price strategy. On the other hand, big enterprises have made constant breakthroughs in advancing technology and reducing cost while improving the cost efficiency of products. Driven by both dismal survival and scale effect demands, small and micro enterprises will usher in the period of mergers and integration within two to three years.

Sanan Optoelectronics rapidly captured the domestic market with more competitive cost advantages. Meanwhile, it has been vigorously expanding into the overseas market and made an overall layout in advance through building plants abroad and extending marketing channel. Additionally, after the successful merger of Guolian, Epitech and HL, Epistar continued merging Huga Optotech Inc., with the number of MOCVD reaching 300, far exceeding Samsung with 150 MOCVD and seized the dominant position within the industry.

Nationstar, a packaging enterprise, not only extended to the upper and lower reaches of the industry and made an overall industrial chain layout, but it also made efforts in the terminal channels by officially establishing an operation center in the decorative lighting plaza of the Zou District, Changzhou on Oct. 12, 2012. The lower reach enterprises were in a more obvious trend of channel layout. Kingsun hit the market with a more competitive price advantage. The 10-mile decorative lighting plaza has been dominated by brands like Tsinghua Tongfang, Kingsun, Samsung, etc.

Therefore, it remains a question for the entire industry to think how to embrace the third growth peak characterized by LED lighting applications in the wave of integration. CHINASSL2012, which aims to promote international exchange and cooperation of LED technology and its applications and to guide the development orientation of emerging industries in China’s LED industry, will take place between November 5-7, 2012 in Guangzhou, during which government representatives, industry experts, research institutes, and famous enterprises located at home and abroad from 10+ countries and regions will attend the forum and probe into the development momentum of the LED industry from different aspects.

Additionally, nearly 100 industry-leading enterprises will exhibit, and tens of thousands of professional visitors and buyers are expected to visit the exhibition. As previously announced by the organizer, this exhibition will launch a LED demonstration platform for commercial lighting —  the Innovative Lighting Design Gallery will showcase the main products and future trends from famous brands of LED lighting applications in the commercial lighting field, including Megaman, Samsung, etc. To echo the commercial lighting demonstration theme, there will be a series of onsite activities such as “The Fifth Chinese Lighting Design Debate,” “Green Lighting Design International Summit,” LED Product and Technology Seminar,” etc. to meet your varying demands.

CHINASSL 2012 is the must-attend exhibition of 2012!
(Author: He Yaping)

China Solid State Lighting Alliance (CSA), which consists of leading Chinese LED enterprises and a research institute, was founded in 2004 under the support of Governing Committee for China Solid State Lighting. CSA aims to promote technological advancement and commercialization of SSL, accelerate development and establishment of standards, evaluation and quality testing methodology, establish an information service platform for SSL industry, enhance regional and international cooperation, establish communication access between government and industry, and facilitate individual development and integration of discrete resources to improve the global competitiveness of the China SSL industry.

Reed Exhibitions is the world’s leading events organizer, with more than 460 events in 36 countries. In 2010, Reed brought together over seven million event participants from around the world, generating billions of dollars in business. Today Reed events, organized by 34 fully staffed offices, are held throughout the Americas, Europe, the Middle East and Asia-Pacific. Reed organizes a wide range of events, including trade and consumer exhibitions, conferences and meetings. Its portfolio of more than 460 events serves 44 industry sectors. For more information, visit

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