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Market Characteristics of the Five Major Segments of LED in 2014

Today is December 4, 2014, and the year has come to an end. The LED industry has generally developed well in 2014. Let’s take a look at the market performance and characteristics of the five major segments of LED chips/epitaxial wafers, driving power supplies, LED displays, LED street lights, and LED light sources this year.
The LED chip/epitaxial wafer field in 2014 showed the following characteristics:
1. In the first half of 2014, LED chips continued to grow. At the same time, the concentration of the LED chip industry became higher and higher, and the polarization of domestic LED chip factories became increasingly serious.
2. With the rise of mainland LED chip and epitaxial wafer factories led by Sanan Optoelectronics and Dehao Runda, domestic LED chips have gradually gained recognition in the local market, taking away the market share of Taiwan-made LED chips in the mainland market.
3. The design and manufacturing of LED chips are developing in the direction of "small size, high current, low voltage, and high lumen", with the same light efficiency but smaller size, or the same size and higher light efficiency.
4. The limited market capacity determines the relationship between enterprises. At present, the overall overcapacity situation in the LED industry from epitaxial chips to packaging to downstream applications has not changed, and the Chinese chip market is still digesting production capacity.
5. The third quarterly reports of LED listed companies in 2014 have been released one after another. More than 50% of LED chip factories have achieved good results in the first three quarters of this year. The LED chip companies on the list are polarized. It is expected that the market position of LED chip factories will change this year except for the top three.
The driving power supply field in 2014 showed the following characteristics:
1. LED lighting driving power supply grew rapidly. As of the end of 2013, the number of LED drive power companies in China exceeded 400.
2. There is a lot of room for growth, but the gross profit level continues to decline. Some power supply companies lack the motivation to release performance, and competition in LED street light power supplies is becoming increasingly fierce. These companies are seeking transformation.
 3. The market needs high-quality LED driver power products. Overseas, customers have extremely strict requirements on the efficiency conversion, effective power, constant current accuracy, power supply life, and electromagnetic compatibility of LED drive power supplies; at home, the power supply market has gradually shifted from the previous low-end price competition to more demand for high-end brands.
In addition, from September 1, 2014, LED drive power supply will be included in the scope of 3C compulsory certification. The execution time of this 3C certification is September 1, 2015. The country has incorporated it into the 3C compulsory certification system, which means that LED power supply companies must meet 3C certification standards before they can be sold on the market. This will be a blow to companies that do not follow the rules.
4. The modularization and intelligence of LED power supplies have become a trend in general lighting. The cost of LED power supply will be lower after modularization, and intelligence can meet people's living needs, such as dimming, temperature adjustment, etc.
The LED display field in 2014 showed the following characteristics:
1. In the first half of 2014, China's LED display market changed little compared to last year. Enterprise orders were relatively stable, but many small and medium-sized enterprises were in a state of low profit, and there was a common problem of difficulty in repayment. "Triangular debt" is still a common problem in the LED display industry.
2. New market segments have become new growth points for LED display companies. Market segments such as outdoor advertising media and indoor small spacing still maintain good growth, allowing the LED display industry to maintain certain growth. For example, Ledman Optoelectronics has laid out its plans in the field of sports media.
3. The "small era" of LED display screens - small spacing LED screens. Major LED manufacturers around the world have begun to compete to launch their own small-pitch strategies, and domestic and foreign companies are also optimistic about the prospects of small-pitch LED products. Among them, high-density small-pitch LED display screens are an important emerging market in the industry and are also one of the markets with high product profit margins.
The LED street light field in 2014 showed the following characteristics:
1. The overall environment of LED street lights has tended to be stable. However, due to the influence of many objective factors such as the change of government and anti-corruption, the advancement of LED street lights this year has been significantly lower than expected, the growth rate has slowed down, and there has been a situation of more monks and less rice. The market is more rational.
2. Overall, LED street lights have made great progress this year in terms of overall road illumination, uniformity and glare control. However, due to tight market demand and a large base of LED street light manufacturers, market competition is fierce. LED street light orders are mostly concentrated in larger enterprises. In the future, LED street light manufacturers will not only compete for quality but also price. It is also the goal of many LED street light manufacturers to seek new economic growth points.
 3. The structural design of LED street lights has changed, and light source modularization has become a new trend in the future. In the previous integrated and modular designs, once there was a problem with the lamp, the entire lamp had to be replaced. However, after the light source is modularized, only the electronic control part needs to be replaced. Although it does not save costs from the perspective of a single lamp, the cost is lower in the long run.
4. The application of intelligent control systems in LED street lights is gradually increasing. Many street light companies at home and abroad have begun to devote themselves to the research and development and production of intelligent LED street lights, such as international giants such as Philips and GE, and domestic rising stars such as Qinshang Optoelectronics and Zhongwei Optoelectronics. Smart LED street lights can save 10% to 20% more energy than the original LED energy-saving technology. However, the stability of the smart LED street light system is insufficient, the failure rate has doubled, and the system may break down faster than the lights.
The LED light source field in 2014 showed the following characteristics:
1. LED fluorescent tubes and bulbs became the top two LED light sources with the highest sales volume in China. China is the world's largest lighting production, sales and user country, and China's high-efficiency lighting product output accounts for more than 80% of global output. The LED bulb market will continue to develop rapidly.
2. Conventional products such as LED fluorescent tubes and bulbs maintain a price reduction trend, and there will be fierce price-performance competition in the next two years. It is expected that by the end of 2015, the price of LEDs with the same light efficiency and the price of energy-saving lamps will reach a ratio of 1:1, and costs and prices will continue to decline by 30%.
3. The sales volume of LED light sources in e-commerce channels is getting higher and higher, and more and more LED lighting manufacturers are developing e-commerce.
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