Analysis of the Four Major Development Trends of China's LED Chip in 2018

In recent years, there are two obvious trends in the new pattern of LED chip industry. The first trend is the transfer of capacity to mainland China. As the gap between domestic and international technology is getting smaller and smaller, due to factors such as production costs, coupled with the active promotion of domestic government policies, foreign enterprises slow down the pace of expansion, and even some enterprises gradually shrink production capacity, domestic LED chip production capacity accounted for more and more high, in the long run, domestic LED core. The scale of the film market is bound to continue to expand. The second trend is that the LED chip industry is becoming more and more concentrated.

After the second-line manufacturers withdrew from the market in 2015-2016 and the subsequent drop-out of backward capacity, the mainland's main first-line LED chip manufacturers, including San'an Optoelectronics, Huacan Optoelectronics, Australia and Ocean Shunchang, Qian Optoelectronics, etc., have actively expanded their production by relying on capital, technology and scale advantages. By the end of 2017, the capacity of China's LED chip industry was 8 million 600 thousand units per month.

By the end of 2017, the top four chip manufacturers in China accounted for more than 70% of the market share. The top four were Sanan Optoelectronics (2.8 million tablets per month), Huacan Optoelectronics (1.7 million tablets per month), Shunchang Optoelectronics (1 million tablets per month) and Dry Optoelectronics (550,000 tablets per month), accounting for 32.6%, 19.8%, 11.6% and 6.4% respectively. Overall, China's LED chip industry has a high degree of concentration.

China's LED industry started from the packaging development, the initial chips mainly rely on imports. In recent years, driven by the strong demand in the downstream and the support of local policies, the major domestic LED epitaxial chip enterprises increased research and development investment, actively set expansion plans, the market for epitaxial chip investment continues to increase, making domestic L. ED epitaxial chip industry is accelerating.

Since 2013, the market size of LED chips in China has been increasing year by year, as the capacity of manufacturers in mainland China has increased and the gap between technology and Taiwan has become smaller and smaller. According to the data, the market size of China's LED chip industry (excluding Taiwan) reached 18.9 billion yuan in 2017, an increase of 48.8% over 2016, accounting for 37.1% of the world's LED chip output value.

After several years of development, China's LED chip industry has initially formed five major industrial clusters in the Yangtze River Delta, Pearl River Delta, North China, Jiangxi Province, Fujian Province and other southern regions. At present, the Yangtze River Delta region is the main production base of LED chips in China. At present, the largest number of LED chips enterprises are put into production, and the output value is the largest. Statistics show that the Yangtze River Delta region will plan to introduce 1209 MOCVD in the future, ranking first in the five regions.

As the gap between domestic and international technology is getting smaller and smaller, as well as the active promotion of domestic government policies, foreign enterprises are slowing down the pace of expansion, and even some enterprises are gradually shrinking production capacity, the domestic LED chip production capacity proportion is increasing, in the long run, the domestic LED chip market will continue to expand.