Taiwan LED industry oversupply continued until next April

Since the second half of 2008, the LED industry is small and medium size backlight demand sharp recession, in the fourth quarter to pile up in excess of requirement dilemma, the situation has not improved, the market continues to deteriorate, the remaining half of the capacity utilization rate, many factories have upstream epitaxial losses. The overall LED downstream related applications such as mobile phone backlight, large key light, small and medium size backlight demand is very weak, the manufacturers generally bearish in 2009 first quarter, is expected to total revenue and gross margin will continue to decline, until the end of the first quarter will have a chance at the end.

The financial and economic downturn, LED industry is not much good news, but the new LED applications continue to be developed, as long as the downturn in the winter in the past, practitioners of recovery of LED competitive power is expected to be better than other industries. In recent years, LED is regarded as the new trillion industry in the future, because of the huge business opportunities, facing many new entrants, the rapid expansion of market profits increasingly difficult, pile up in excess of requirement, LED industry in the winter of 2008 even than other industries to the early market has started to worry about whether LED will embark on DRAM's footsteps. Dramexchange chairman Liu Jionglang said that many industries including DRAM, solar energy, automobile, television and so on, are facing the same problem, the future is not optimistic, but not pessimistic, believe such as Darwin's theory of evolution that the survival of the fittest. In addition to the technical advantages of LED industry efforts, horizontal or vertical integration is also the direction of development.

Previously, LED more than 50% applications in the mobile phone and other consumer goods, mobile phone is closely linked with the ups and downs of the market, is expected to 2009, LED application will greatly increase the proportion of the liquid crystal display, first is the current hot small notebook computer, NB backlight, in each big brand laptops have taken LED as the backlight source. In 2009 the penetration rate of at least 35%, billion light will be the first to benefit from manufacturers.

Insiders said that the future of LED growth will come from the LCD TV and lighting in two major areas, in the LCD TV, the Samsung most active development and promotion of the product, once successfully opened the LED market demand, have the opportunity to end early winter, Taiwan extension leading factory electricity crystal biggest beneficiaries. As for the lighting field, the future business potential larger, although the general lighting products and technical specifications are not mature, the market is still at the initial stage of development, but the special lighting products diversification, high added value, let Taiwan LED downstream packaging application vendors to find a lot of new business opportunities. Frozen lamp lights, the Hong Qi Xing Baihong, commercial lighting, have the opportunity to develop new applications with the resistance to cold winter. According to the expected LED upstream epitaxial plant in low capacity utilization of Yongfeng gold, mix and match of inventory liquidation case, gross margin performance for the fourth quarter of 2008 to the first quarter of 2009 before the various manufacturers are still under repair space, and do not rule out the negative gross margin, is expected in the second quarter of 2009, inventory level is low with the new application gradually stabilized, the gross margin has the opportunity to self bottoming out.