The reason why LED bottleneck?

Lack of core technology, excess capacity, investment overheating and other circumstances, so that China's LED industry is facing development bottlenecks. Due to the saturation of the domestic market, more and more LED companies began to open up overseas markets, for a time, exports have become a new direction for the development of LED industry.

Since November 2011, China's national development and Reform Commission announced the elimination of incandescent roadmap, dividend policy to allow the rapid development of LED industry. But with the LED market is gradually saturated, the competition is becoming increasingly fierce, since 2012, the LED industry seems to be going downhill. What is the reason? According to the survey, the lack of core technology, excess capacity, investment overheating and other circumstances, so that China's LED industry is facing development bottlenecks. Because the domestic market is saturated, more and more LED companies began to open up overseas markets, for a time, the export has become a new direction for the development of LED industry, however, rely on exports and not let LED industry to achieve long-term development.

Indeed, at present our country's LED industry has some problems: the development of the foundation is weak, supervision starts late, products with low added value phenomenon has not been fundamentally changed, accelerate the improvement of LED products in China's technological innovation capability, strengthen the industry research and development of production, learning and research, has become a pressing matter of the moment. The current pattern of LED industry is like the spring and Autumn period, this pattern is detrimental to the long-term development of the industry. LED industrial base has not been able to form a model of industrial cooperation and development, the industry chain has not formed an interactive, from all provinces and municipalities are to go alone, the competition between the industry is very confusing.

The reason why LED bottleneck?

In this situation, the local government pushing hands is a factor that can not be ignored. Even more worrying is that the country has been formed around the LED fast on the pattern, will eventually lead to price competition among enterprises, this phenomenon has been proven by the market. And another need to cause the attention of the industry policy makers is that some of the new products in a variety of lighting show has been covered with old dust. The government policy support, the industry and the market is standardized? The current environment by the government department in charge of industrial policy may not solve some problems of the development of green lighting industry and exposure, must be adopted to regulate national legislation.

From the beginning of 2012, the investment in the upper reaches of LED caused a rapid decline in the price of the downstream business competition, resulting in the closure of some enterprises. This continues until this year. Most LED companies lack technology, chips and other core components, highly dependent on imports. Enterprises do not have the strength of R & D, rely on plagiarism, big price war, so that the market is not standardized chaos. Coupled with government support, not only can not solve the problem of overheated investment in the industry, and even counterproductive. Local governments over the years in the LED industry fragmented, has been hidden for the current overcapacity. Data show that in 2009, LED upstream chip is still in short supply, in 2011, there has been a significant oversupply. Like other emerging industries, LED industry overcapacity is actually a structural, mainly in the downstream low-end products, while the upper reaches of high value-added products.

In addition, more and more enterprises in China are staring at the LED industry, resulting in a serious imbalance in the industrial structure. Data show that domestic manufacturers engaged in LED industry up to more than 4000, and at this stage LED industrial structure in an unbalanced form. 2012 China's overall LED output value of 205 billion 900 million yuan, of which $159 billion belongs to the downstream terminal applications, accounting for 77.2%, while the upstream LED chip output value of only $7 billion 200 million, accounting for more than 3.5%. This phenomenon leads to traditional sales agents in the promising industry prospects, competing to enter the field of LED at the same time, but at the end of the low end products and hesitant.