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LED Ecosystem Teems With Thousands Of Players In Dense Supply Chain

The production of LEDs involves thousands of companies. IHS Inc's latest research note by principal analyst Jamie Fox, focuses on this complex ecosystem and in particular the Chinese LED value chain, covering everything from base resource manufacture, to end-product distribution.

The key steps in LED production are substrate and die production, packaging, and end use in backlight modules, lamps, automotive displays and many other applications. Some companies operate at several layers in the value chain with a number of the tier one companies being vertically integrated, while most companies focus primarily on supplying one type of product.

China has the largest manufacturing base and the largest number of suppliers of any country in the world. There are hundreds of other companies in the market, but the graphic (above) shows how complex the market can be and the many layers of production that exist from base equipment to the final end products.

LED production requires many pieces of equipment. MOCVD reactors are the most costly and one of the most fundamental to the process. The global market for MOCVD is forecast to be $250 million in 2014, with two main providers, accounting for a significant proportion of the market, as well as a number of smaller providers.

The LED die industry has over 100 companies in the market. IHS has identified 45 of the largest ingot/wafer companies in its recent LED ecosystem report.

At the packaged LED level, the global market this year is valued at an estimated $19.8 billion. There are thousands of companies here representing chip manufacturers, package LED companies and packaging material companies for phosphor, lead frame, encapsulating materials, ceramic and gold wire. More than 90 of the largest companies are identified in the recent IHS report on the LED ecosystem.

The worldwide market for LED lamps is predicted to be $8.6 billion this year, with hundreds of branded and unbranded companies in the space. The recently published report from IHS on the LED ecosystem has identified over 300 of the largest lamp and luminaire companies globally, as well as 60 specialised importers/distributors and 26 of the largest OEM partners for major Western brands.

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