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alexyang
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LED Production Equipment Will See Significant Growth in the End of 2013
alexyang   1/4/2013 4:44:33 AM
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LED hasn't achieved popularity in general lighting application; but it is expected more than 50% lamp holders by 2018 will access LED, and over 80% of lamps in the market are LED lamp. However, the market scale of currently pretreatment LED production equipments is smaller than two years ago. Comparing with $1.9 billion in 2010 and $1.7 billion in 2011, 2012 saw scale of only $600 million. Enterprises will invest in the second half of 2013; by 2014, LED production equipment industry will achieve significant growth, but this will be the last large-scale investment for LED industry. Later, market size will continuously shrink, becoming a market basically relying on the redemption demand. 

It is projected by 2018 LED will increase the area of semiconductor materials for four times from 2012; revenue also will reach a peak of $17 billion. Sales, despite the peak in 2012 or so, will gradually reduce due to the following two factors. First, because of substantial increase in the amount of light emitted by a single LED, so the quantity of needed LED will decrease. Second, comparing with current technology, LED product largely extends life, so there is no need for replacing one or two light bulbs in one year, 10-year service life is available, which will lead to the great and permanent deceleration to LED market. 

There was over-investment before 2011. 

In the next five years, the production of the LED will continue to expand, then, why the production equipment market has already peaked and rebound? This is because large-scale over-investment occurs in 2010 and 2011, the major reason of which lies in that Chinese government subsidies the MOCVD equipment, enterprises, in order to ensure market position, has to strive to toll cash. As of 2010, only several Chinese enterprises have stepped into LED production equipment area, but now there see a growth of 70. In addition, most enterprises are short-lived, and those survived companies will not purchase new equipments, but achieving production capacity increase through acquiring failed enterprises. 

When buying production equipment, in order to decline cost of ownership(COO), on one hand, part of enterprises invest those reliable and uniform high-performance equipment. On the other hand, some enterprises plan to reduce the amount of investment in equipment, minimize the manufacturing cost through purchasing the cheapest device. But now, most companies (including the vast majority of Chinese enterprises) have begun to opt for the former one. 

 

Analytics from Baitron Electronics





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