Keywords that Defined the LED Industry in 1H16–Part II

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Four market keywords

Cross-industry

16463729184_807576e953_bThe list of companies on China’s over-the-counter market list has grown significantly, acquisitions are broadening and no longer limited to the LED sector, but increasingly involves newcomers from different sectors. Examples include Ledman Optoelectronics acquisition of several sports enterprises, Changelight selling its LED business to focus on education industry, Changfang Lighting establishing an education fund, and Honglitronic’s rebranding as Honglizhihui to enter connected car sector.

The first half of 2016 is marked by horizontal and vertical alliances in the industry, where acquisitions are no longer the main theme. Cross-industry transitions have become the new show of the year to stimulate the industry. If acquisitions was the main thing in the past few years, than the first half of 2015 is marked by cross-industry collaborations and transitions.

 

 

Niche lighting market

I took this image on April 5 2008 at Uji-Urata Ise, Mie Pref., Japan.

 image taken on April 5 2008 at Uji-Urata Ise, Mie Pref., Japan.

The LED industry was bombarded with price wars, which made it difficult to ensure product profits. LED niche markets have become the new generation of less explored blue sea markets, such as automotive LEDs, UV LED, IR LED, smart lighting and grow lights.

In the past few years, “super” price wars diminished LED lighting industry profits. To avoid being destroyed by price wars, the industry is seeking less explored markets. The year 2016 marks the LED industry blue ocean year, where manufacturers are exploring opportunities in automotive lighting, UV and IR LED.

 

 

 

LED+

OLYMPUS DIGITAL CAMERA

OLYMPUS DIGITAL CAMERA

The post LED lighting era is still mostly stuck in the mentality of replacing conventional light sources, where the market outlook is dim. The post LED lighting era has presented diverse possibilities for LED+ concept, such as integrating the light source with VR, robots, design, connected cars, and even education.

Finding one’s market is most important for LED manufacturers during first half of 2016, and after undergoing massive restructures in 2015, the LED industry has become much more rationalized in 2016. Enterprises have also eased their price wars, and started to deploy their “plus” concept in the LED industry. The LED plus concept is picking up rapidly in the VR market, and sectors including industrial robots highlighted by the Made in China 2025 initiative and online banking.

 

 

 Patents

6082519875_83a9edfd36_b_副本Some of Nichia’s YAG patents will expire by 2017. Chinese manufacturers that are in desperate need to export products have witnessed major global players up their game in patent disputes. For instance, Nichia and Everlight’s long patent disputes are coming to an end, Harvatek and Cree arrived to a settlement, and Enplas and Seoul Semiconductor patent lawsuits concluded.

Chinese LED manufacturers need to resolve patent issues if they want to export their products overseas, but have been the Achilles heel for most Chinese companies. In the last two years, Chinese companies launched acquisition campaigns to bridge the technological gap with international companies. Upgrading patent wars is crucial if Chinese manufacturers want to export their products abroad in 2016.

 

 

To be continued…

Resource from LEDinside News

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