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TrendForce: Chinese LED package companies are rising

While technical progress is still the greatest challenge, China's chip market is dominated by LEDs
Market research firm TrendForce's Green Energy Division LEDinside says that in 2013, the Chinese LED packaging market value increased far quicker than the global average.

LED lighting is still the largest application field in the 2013 Chinese LED packaging market, accounting for 42 percent.

Due to the rapid growth of the Chinese LED commercial lighting market demand, Chinese lighting-use LED manufacturers such as MLS Lighting, Honglitronic, CF Lighting have performed outstandingly.

High-quality indigenous chips greatly improved the competitive position for Chinese LED lighting-use in the LED packaging industry. According to LEDinside, indigenous chips have accounted for almost 80 percent in the 2013 Chinese chip market.

In the backlighting field, LEDinside analyst Allen Yu says that with the support of Chinese TV and mobile phone manufacturers, mainland package manufacturers gradually replacing those in Taiwan, Japan and Korea in the market has become an irreversible trend.

In the TV backlighting field, Refond, DSBJ, AMTC, Shineon and other manufacturers have all performed well and entered into China’s top six TV manufacturers' supply chain.

Supplying products for brand manufacturers can not only significantly improve quality control and management capability of Chinese LED package industry, but also help Chinese package manufacturers to accumulate strength for participating in global competition.

For emerging fields such as automotive lighting and Flash LED, the situation of international manufacturers monopolising the market is expected to change. Chinese package manufacturers are actively penetrating these emerging markets. In the case of the competitive lighting, backlight and display markets, these emerging fields are expected to become the new battle ground for Chinese packaging manufacturers to compete.

In view of global market, the main challenge for Chinese LED package manufacturers to improve market share in the future still comes from technology. In 2013, EMC lead frame materials, flip chip, CSP and other emerging technologies appeared.

ETi and Sanan Optoelectronics have successfully developed flip chip technology, and EMC lead frame has also attracted much attention. Lightning Optoelectronic, Smalite Optoelectronics, Honglitronic, Refond, APT and other manufacturers have adopted EMC packaging production lines.

Although it is not able to reshape the competitive landscape, the impact on existing industry development is still worth noting.

LEDinside says it will take some time to verify how the new materials and new technologies will affect the existing industry development in next few years.

Allen Yu points out that LED packaging technology evolution always focuses on the continuing drop in end-use costs. Use of new packaging materials, formation of new packaging specification and emergence of new packaging technology are to reduce the cost per lumen on the premise that the quality is guaranteed.

LEDinside expects that the global LED lighting product shipment will grow by 68 percent in 2014, with the production value reaching $17.8 billion. Under the situation that the backlight market penetration becomes saturated and other applications are still in emerging progress, how Chinese LED packaging industry seizes the opportunity of rapid development of the global lighting market will become an important factor to the outcome of manufacturers.

The LEDinside research team will be hosting the “LEDinside Chief Analyst Market Seminar” at Hawaii Room on the seventh floor of Marco Polo Shenzhen, China on December 19th, 2013. The forum will be covering global LED industry and China’s LED industry trends in 2014, and analysing the lighting, backlighting and packaging industry.


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