2018 LED output value, market demand and development trend analysis

As one of the links with high threshold in the LED industry chain, the non-visible light product market has been occupied by overseas enterprises. Only a few domestic enterprises such as Sanan Optoelectronics have entered this field, however, in the field of visible light LED chips, in addition to headlights, etc. In 2018, the output value of China's LED chips continued to increase, accounting for 1/3. LED is the abbreviation of the English name of light emitting diode. Its luminous wavelength covers all visible light and other light bands such as infrared and ultraviolet. As one of the links with high threshold in the LED industry chain, the non-visible light product market has been occupied by overseas enterprises. Only a few domestic enterprises such as Sanan Optoelectronics have entered this field, however, in the field of visible light LED chips, in addition to headlights, etc. The technical threshold outside high-power products is slightly lower, and the market of 85 is being accelerated by domestic chip companies. The market size is 400- 50 billion yuan, the output value of China's first-line chip factory is still far from this scale. The packaging and application links in the middle and lower reaches have been the first to transfer to mainland China in the chip link, driving the rapid expansion of China's LED chip market demand. LED enterprises in mainland China have not stopped expanding production, 2011- 2016 of purchasing the 60 of MOCVD output value share year by year increase 2016 output value reached 14. 5 billion yuan share accounted for than 32. With the expansion of chip production after 2017 only concentrated in the first-tier manufacturers in mainland China, it is expected that the output value of China's LED chips will be close to half in 2018, and the market share of the top ten chip companies will increase from 77 in 2016 to more than 90. Figure: China's LED chip output value continues to increase Figure: China's LED chip output value accounts for 32 (2016) In 2018, China's LED packaging and application output accounted for more than half of the packaging and application links in the middle and lower reaches of LED. Due to the low entry threshold, unlike the core technology of the upstream chip link, which is mainly in the hands of European and American Japanese enterprises and has a huge investment, LED packaging and application in mainland China are developing rapidly and account for a high proportion. 2016, China package output value accounted for than close to 60 and in countries in growth fast developed countries package output value average annual reduction close to 10, the average annual growth rate of China's three major packaging companies, mulinsen, Hongli Zhihui and Guoxing Optoelectronics, exceeded 30. In the application fields such as lighting and display, Chinese enterprises have great cost advantages. With the maturity of mainstream products in the market, enterprises in developed countries gradually lose their competitive advantages, gradually strip the LED application business or outsource it to Chinese companies for OEM production. Figure: China's LED packaging output value continues to increase figure: China's LED packaging output value accounts for 58 (2016) Figure: China's LED application output value continues to increase figure: China's LED application output value accounts for 53 (2016) In 2018, the downstream application market continued to grow, and the supply of upstream chips was in short supply. In 2016, the markets of LED small spacing, general lighting and automobile lighting continued to grow, and the demand for LED chips increased. LED chip manufacturers have repeatedly raised product prices to cope with the market situation of short supply. Figure: LED application market composition-2016 Figure: LED general lighting market grows rapidly (Billion dollars) After years of reshuffle in the LED industry, small and medium-sized enterprises that have no technology accumulation to improve production efficiency are gradually eliminated. From the second half of 2015 to the beginning of 2016, the market competition was fierce, and large factories with lower technology and cost took the initiative to cut prices, and small factories were forced to close the production line. These small factories are old and have no ability to upgrade equipment and technology. The cost is high and they have to quit the LED industry. There are only a few companies that can continue to make profits in the domestic LED chip link. In the face of the continuous growth of demand in the middle and lower reaches, the first-line enterprises of technology have unanimously made the decision to expand production, and the industry concentration will be further improved. Figure: China's LED chip industry concentration rises, Figure: China's LED chip market share distribution-2016