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Brief Analysis of LED Industry

With the enhancement of residents’ awareness of environmental protection and the continuous improvement of the economical cost-effectiveness of LED lighting products with technological progress and cost reduction, LED lighting is gradually becoming one of the hottest industries in global economic development.

LED lighting products can generally be divided into LED lamps and LED light sources. Because the integrated design of LED lamps is usually easier to integrate with the surrounding environment and has a more beautiful effect, with the continuous decline of the product unit price, the acceptance of LED lamps has been continuously improved, and has gradually become the main category of LED lighting products, currently occupying 80 % of the market size.

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From the perspective of application fields, LED lighting mainly includes three specific application fields: LED general lighting, LED landscape decorative lighting, and LED automotive lighting.

From the perspective of application scale, the penetration rate of general lighting in China is getting higher and higher, and the proportion is the largest, and

the application scale of automotive lighting is the smallest and basically unchanged.

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In the LED lighting industry chain, the upstream mainly includes LED beads, electronic components, packaging materials, plastic parts, hardware and other core materials, and the downstream flows into home, office, commercial, industry and other fields.

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With the continuous development of the LED market, the number of LED enterprises has increased rapidly, and the competitive pressure of enterprises has continued to increase. In order to enhance its own competitiveness, a new trend has emerged in the transfer of the global LED industry.

 

The following analyzes the competitiveness of the LED industry from five aspects:

 

(1) There are relatively many participants in the LED lighting industry, and there is a large gap between companies in and within the echelon, and the market concentration is low; at the same time, the level of product homogeneity is strong, and the competition pressure is high.

 

(2) LED lighting is a technology-intensive industry, and there are high technical barriers to entering the industry. But from the point of view of attractiveness, the gross profit margin of LED lighting companies is relatively high, the profit level is relatively high, and the attractiveness is strong. Potential entrants are more threatened.

 

(3) The fifth-generation light source has not yet appeared, and the national policy strongly supports the development of the LED lighting industry, and the risk of substitutes is small; from the perspective of homogeneity, LED performance is better, more energy-saving and environmentally friendly, compared with other light sources, the The level of quality is low. Overall, the threat of industry substitutes is small.

 

(4) From the perspective of the upstream bargaining power of the industry, except for LED chips, the upstream LED industry in my country has relatively sufficient competition, relatively stable production technology, relatively sufficient supply, and average bargaining power.

(5) From the point of view of the downstream bargaining power of the industry, the downstream application fields are extensive, attracting a large number of small enterprises and participating in market competition through simple OEM, resulting in a highly competitive market for low-end products, and the phenomenon of product homogeneity is relatively serious. , the downstream has greater bargaining power. Overall, the bargaining power is strong.

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In the future, the LED lighting industry will further develop around the core connotations of convenience, health and circulation, and will continue to evolve towards the three development directions of intelligent lighting (lighting control and connection), human-induced lighting, and circular economy.