Chaos in the market of LED lighting will last 3-4 years| 21.12.2011
The outgoing year has become the most successful and profitable for the led industry, according to DigiTimes. According to representatives of Philips Taiwan, 2012 will be for the market year of consolidation experience and
the mess will probably last for the next 3-4 years. Despite this, according to Edward’s (Edward Po), President of Philips Taiwan, revenues of LED industry by the end of 2011 show annualized growth of
30-40%. The market is expanding pretty fast, but many companies still have not reached the intended and desired profits due to severe price competition. Although the cost is already released in China
LED products is $24 billion this year (22% increase), the industry feels a strong influence of excess supply and low demand for finished products. A significant number
LED companies and industries in China have stopped production this year.
At noted that the overabundance of products on the market is associated with overly optimistic attitude to the future forecasts for the market in the initial stages of its formation. Such views attract many
new firms on the market. As a result, industries have to play in price competition to increase production to break even. Therefore, 2012 should
be a year of consolidation of the experiences of various market participants, and it is essentially the beginning. The process of eliminating small firms, mergers and acquisitions will last for about 3-4 years. After that
the market situation will return to normal. According to Via, the penetration of led lighting will reach 10% by the end of 2011.
The market situation is overestimated and the Government of China. In the next (12th) “five year plan” in China adopted a programme of subsidies LED industry. It was expected that the subsidies in this time
will be quite significant. According to market analysts, these firms like Everlight, Ledtech, and Delta can benefit from new support programs from the state. However, according to other sources,
subsidies will be allocated only based support of release 4 million units of LED products. This corresponds to the amount of $32 million or 100 million yuan, much less than previously expected. Earlier
called the figure of 8 billion yuan. However, the Taiwanese participants in the led lighting market with optimism look at subsidies market LED by the Government of China even in this
volume. More precise figures will be announced later.