LED investment boom - calm thinking behind carnival

China's semiconductor lighting industry is developing rapidly. According to the GLII survey, the total industry output value in 2009 was 82.7 billion yuan. In 2010, the overall industry scale is expected to exceed 119 billion yuan, and the growth rate will exceed 40%. China's 2010-2015 compound growth rate (CAGR) is expected to be 35%. In 2015, the overall industry scale will reach 500 billion yuan.

GLII made a bold prediction on the popularity of the LED lighting market. In 2008, the LED lighting market penetration rate was only 5-10%, reaching 45% by 2015 and over 70% by 2020.

We seem to be able to see the brilliant future of LED lighting. LED technology is becoming more and more popular, and a batch of LED companies are rapidly emerging, and the industrial cake is getting bigger and bigger. LED is hailed as “the most fashionable new energy industry in the moment” and even given the mission of “the third light source revolution”. Many people believe that replacing traditional lighting with LEDs is only a matter of time.

The great heat of the industry has attracted many companies from all walks of life. Many companies that have never been involved in the LED industry have joined in the past, hoping to catch up with the high-speed trains of “energy saving, green and environmental protection”. According to GLII statistics, the number of domestic LED companies has increased sharply this year, with 70, 1200, and 3,000 in the upper, middle, and lower reaches respectively. Compared with the same period of last year, the number has increased by about 30%.

However, the great heat of the industry does not mean the corresponding expansion of the market scale. The development of emerging technologies, in addition to the initial lucrative profits, is more caused by the overcapacity. At present, the industry can be clear that LED lighting will make outstanding contributions to the cause of social energy conservation. But such a frenzied investment boom is good or bad for the development of the LED lighting industry. Whether the LED investment boom can drive the development of the industry requires very rational analysis and judgment.

Party A

Investment boom will promote industry development

Dr. Li Cheng, Foshan Guoxing Optoelectronics Co., Ltd.

LED investment is definitely overheated. Both the government and the enterprise are mad at LEDs. The overcapacity is estimated to be inevitable, but this is not necessarily a bad thing.

Whether in China or abroad, when an industry develops into a mature period, the market is large and profitable, and there will inevitably be an investment boom. For example, the previous solar energy has also experienced such a crazy period. This upsurge will play a very good role in promoting the development of the market, the reduction of costs and the acceptance of the public. In addition, there is a mechanism for elimination in the market. Although the LED market is mixed, the backward production capacity will be eliminated as the competition order is regulated. Small enterprises and enterprises with poor competitiveness will eventually withdraw from the market, and the LED market will also step into the market. The track of benign development.

The LED industry will undergo qualitative changes in 2015

Ma Chengbai, Secretary General of Xiamen Photonics Industry Association

When LEDs can become one of the leading products in the field of lighting, I think 2015 should be a key node. In fact, from Edison's invention of incandescent lamps to the present, it has experienced the so-called four generations of electric light sources, and now more than 50% of the world's use of incandescent lamps. The so-called new energy-saving lamps are only 20% of the market. Consumers have a process of adaptation. According to my observation, if we can achieve technological progress and benign development of the industry on the basis of the existing, in 2015, this industry will undergo qualitative changes.

Mainland China has a huge market and there is no shortage of funds. The key to the problem lies in how to integrate these advantages. The government needs to have a co-ordinated consideration to set up some large-scale project tenders in mature areas. Risk investment should not be concentrated in one area. Da Ming puts the money in a basket and avoids repeating the mistakes of photovoltaics and wind power.

Technology and talent investment is the magic weapon to win

Chen Yansheng, Chairman of China Lighting Association

Nowadays, a lot of investment is to buy land, build factories and buy equipment. Is it a place to buy a house, build a factory, buy MOCVD equipment to produce high quality products? I don't think so. Land, plant and equipment are all hardware, but what is really needed now is software investment, talent and technology. In the future, we can see that the same equipment, if there is no corresponding high-level talents, must not produce high-quality products, such as the R & D team of foreign companies' application products have hundreds of people. Now GE is not blindly producing products. The way they take it is to develop their own products. After the completion of the research and development, the products are given to a certain enterprise. A Chinese company is branded to him, using their brand and their technology.

The investment of our domestic enterprises is precisely in terms of research, development, and talent training. The investment is far from enough. Everyone is willing to spend money on hardware. Therefore, I appeal to more discerning investors to invest in research and development, so that we can shorten the gap with international advanced enterprises.

Party B

The industry is hot and the market is cold and trembling.

Guangzhou Laidi Optoelectronics Co., Ltd. Zhang Min

At present, the LED industry is being fired very hot. Many large and small enterprises have come in and want to divide the LED industry cakes. This has caused many problems such as numerous LED products, chaotic market order, and huge differences in technical standards. Many small businesses just hold the idea of ​​"making a profit and say it again". They don't even think of LED as a career. In contrast to the market, we have not seen a thriving scene. The LED market is not easy to do. For example, street lamps are made, and many units do not accept it because there is no standard specification. The LEDs we are doing now are some project projects. It is not realistic for the general public to accept LEDs because they don't see the real energy saving benefits. What they see is that the price of LED lights is several times more expensive than other lights. More than ten times.

It can be said that the LED industry is currently doing by the government. Every time the LED industry breaks out, there will be a shadow of the government, such as the National Semiconductor Lighting Industry Project in 2003 and the “Ten Cities and Ten Thousand Cities Project” in 2008. However, the government is pushing a little too fast. Too fast, the suspicion of the emergence of the seedlings, has caused the current development of LED malformation.

It is not realistic for LED to undertake the task of energy saving and emission reduction in the entire lighting field.

Liu Shiping, Secretary General of China Lighting Association

Based on the current actual situation, it is obviously unrealistic to expect LED to undertake the task of energy saving and emission reduction in the entire lighting field. Now there is a misunderstanding in society, putting a lot of money and attention on LEDs that account for less than 5% of the entire industry, while ignoring the remaining 95% of lighting energy conservation.

In the next two years, the Ministry of Finance has taken out 670 million yuan and promoted 150 million high-efficiency lighting products every year. It is worth noting that LED lighting is not included in the Ministry of Finance's financial subsidy program for efficient lighting products.

More than 70% of the western and rural areas in China use incandescent lamps, and the coastal areas also have a usage rate of 20-30%. It should be step-by-step and rationally promote energy-saving lamps. It is still too early to talk about LEDs. Projects like “Ten Cities and Ten Thousand Cities” and some image projects promoted by local governments do not exist in foreign countries. Although they master the core technology, they are also in the stage of cautious exploration.

GLII perspective

According to the GLII survey, the current status of China's LED industry investment is: the upstream funds are relatively abundant, and the listed companies' own projects are quite easy to issue in the stock market. If it is a private enterprise project, it will attract more risk capital; the mid-stream and above enterprises will invest from Venture capital and private funds, small enterprises are mainly based on private capital investment, and the scale is small; most of the downstream application enterprises are from private funds. In a sense, due to the scattered and repeated investment, the risk of capital investment increases sharply. It can be said that there is excess investment.

LED lighting involves expertise in many fields such as optics, electricity, and thermals. At present, many companies obviously do not have the professional skills and knowledge reserves in this area. Together with media hype and government policy support, thousands of years Home businesses are crowding into the LED market, and the “Great Leap Forward” posture will inevitably lead to blind investment and low-level redundant construction. The result is disorderly competition in the industry, uneven product quality, and serious waste of resources, which is not conducive to the healthy development of the industry.