The LED industry is booming, and small companies are frequently "running away" from large companies and "expanding"

Since the beginning of this year, the LED industry has been in a state of "warm and cold". On the one hand, there is the "high industry prosperity" that securities companies have been touting since the beginning of the year, and on the other hand, there are "escape scandals" that have been constantly exposed. "The LED industry is gradually moving from a growth stage to a mature stage. Although the rapid growth of the industry continues, the pressure faced by enterprises will not be small at all. In this process, the phenomenon of big fish eating small fish and fast fish eating slow fish will inevitably occur. The number of enterprises will gradually decrease due to mergers, acquisitions, and exits." Wang Fei, senior analyst at LEDinside, said. The high prosperity of the industry is not just a boast From the reports for the first three quarters of 2014 compiled by LEDinside, we can get a glimpse of the situation. Among the 20 listed companies with LED-related businesses as their main business, 15 have experienced an increase in revenue and profit. The competition to expand production in the chip field is still going on. The production capacity of Sanan Optoelectronics, the big brother of mainland China's chips, has always been at the forefront. In April this year, it announced that it would invest an additional 10 billion yuan in the construction of blue-green light epitaxy and chip production lines, with a total scale of 200 MOCVD units (based on 2-inch 54 wafers), and the first phase of launching 100 MOCVD equipment. During the chip downturn two years ago, Huacan Optoelectronics continued to expand against the market regardless of costs. First, after going public, it used the raised funds to establish a wholly-owned subsidiary in Zhangjiagang. The company's production capacity is twice that of the parent company in Wuhan, which is equivalent to three times the original production capacity. Even the low-key and cautious Qianzhao Optoelectronics announced in July this year that it would expand production with a total investment of 5 billion yuan and 100 new MOCVD equipment. The 50 additional MOCVD equipment in the first phase of the project will be installed and produced by the end of September 2015 at the latest. The competition to expand production not only takes place in the chip field, but also in the packaging field. Hongli Optoelectronics’ current packaging production capacity has reached 1,500KK per month, while at the beginning of this year, this number was only 800KK. After Hongli acquires Smed Optoelectronics, the total production capacity of "Da Hongli" will reach 2,000KK/month, of which EMC production capacity alone will reach 600KK (Hongli 200KK + Smed 400KK), ranking second in the country. Hongli will also continue to inject capital into Smed to continue to expand its EMC production capacity. Talking about "big data" these days, what Mulinsen is most indispensable for is the terrifyingly large "big data". Lin Jiliang, general manager of Mulinsen Lighting, said that Mulinsen's monthly LED device production capacity exceeded 20 billion units in 2014, and it continues to expand production at a rate of more than 1 billion units per month. It is expected that its monthly production capacity will reach 30 billion units in 2015. "Under the release of such large production capacity, small companies cannot compete with production capacity, nor can they compete with price. Without a capacity advantage, there is no price advantage." Industry insiders bluntly said that companies with small scales and product routes that are similar to Mulinsen are basically forced to the edge of the cliff. They either jump off the cliff or turn around and switch to other product lines. "Although the industry matures and the growth rate will decline, prices will tend to stabilize and industry profits will gradually return to normal economic profits. Large companies hope to increase market share through continued expansion and occupy a favorable position in this survival competition." Wang Fei said. Different from the large-scale expansion route of large companies, the fate of small companies is more tragic. The reshuffle of the LED industry in 2014 is still accelerating, and naturally many people have been washed away. The companies that were exposed this year were Lihefeng Technology (Shenzhen) Co., Ltd., Zhongshan Fengguang Lighting, Jiangmen Jinqiutian Lighting, Zhongshan Haosai Lighting, Sichuan Yuanli Optoelectronics, etc. According to statistics from LEDinside, from 2011 to 2014, more than 18 LED companies were involved in the incidents that were publicly reported in the press. This does not include those companies that closed down quietly. A person in charge of a private enterprise who did not want to be named had a sad look on his face, "The industry situation is changing too fast. It is not easy for small companies to survive in the cracks. Those listed companies can raise hundreds of millions of capital and pour it in without blinking an eye. The future's war will The competition will be more intense, and who can survive depends on the ability of each company. " To end with a sentence, "Americans invent things, the Japanese make them better, the Koreans make them cheaper, and the Chinese make them less profitable."