Recently, the price of epitaxial and die prices upstream of light-emitting diodes (LEDs) has risen for the first time. The person in charge of Guangguang Optoelectronics has confirmed that it has increased its price by 5% to 10% for Seoul Semiconductor. It is understood that this wave of price increases is mainly affected by the price increase of LED epitaxy upstream such as sapphire substrate. Experts said that this rising wave will affect the cost of Yangzhou LED application business in the short term, especially the cost of TV and lighting products such as LED backlight. At the same time, this wave will also stimulate the Yangzhou LED industry to accelerate the pace of scale development.
Upstream companies: price increases will stimulate companies to expand production capacity
The data shows that the upstream of the LED epitaxy, such as the sapphire substrate, averaged about 20% in the second quarter, and the price of special gas also rose, which made the price of LED chips soar. Relevant persons in the development zone of the city said that this price hike will drive Yangzhou LED upstream production enterprises to speed up production and expand production scale.
At present, the LED market in our city is mainly based on blue-green optical chips. The output of Huaxia and Zhongke Semiconductor has been rising, which has driven the expansion of the production scale of related epitaxial wafers in our city. In January of this year, the production of Ganzhao Optoelectronics made the production of red and yellow chips in our city also enter the stage of scale. With the introduction of the relevant policy support for MOCVD machine purchase in our city, the LED epitaxial film of our city ushered in an excellent development stage.
The relevant person in charge of the development zone of the city said that there were 7 MOCVD machines in the first half of this year, and the annual output of each machine reached 20,000. In the future, MOCVD machines will reach about 20 units, and the city will become the largest production base for epitaxial wafers in China. This price hike will drive the Yangzhou LED industry to gain more profit margins.
Application Enterprise: Technology Innovation to Cope with Price Increase
Recently, the head of Yangzhou Shifu Photoelectric is a bit busy. It turned out that with the advancement of the national “Ten Cities and Ten Thousand Cities†demonstration project, many cities across the country began “road change lightsâ€, and Shi Ford repeatedly won the bid for various government procurement. Faced with the wave of cost increases, the company’s official said that they are not worried. Through technological innovation, the company has developed a number of products that are suitable for urban public lighting, and their price alliance with the corresponding chip manufacturers will largely Solve the cost problem caused by price increases.
Experts predict that due to the increasing popularity of LED applications, including TV, computer and lighting products, the price increase of LED has spread from the upstream sapphire substrate, special gas, LED epitaxy, LED chip to the middle and lower reaches, once the downstream LED Packaging and LED leadframes are also beginning to pass on costs, which will increase the price of end products. The relevant person in charge of the Municipal Science and Technology Bureau said that on the surface, this price increase will affect the cost of the LED application industry in the city at a certain level, but this is also an opportunity to promote technological innovation. As costs rise, companies must strive for profits, must accelerate the technological level of the existing application industry, and resolve the cost crisis brought about by price increases.
Experts remind: price increases will bring a new round of opportunities
With the continuous extrusion of the cost of the application, more manufacturers have begun the upstream “dream-by-dream planâ€, and some packaging companies have transformed themselves to develop LED chips. Experts predict that domestic LED companies will brew a new round of reshuffle.
Experts reminded that with the wave of price hikes, the LEDs will have a two-day situation. In the application-side enterprise, a group of enterprises with backward technology and simple product structure will be merged. As more and more companies are involved in the LED upstream market, it is likely that LED overcapacity will occur, resulting in a new round of price cuts. Yangzhou enterprises should seize the commanding heights and standard rights of the industry and respond to the ever-changing market.
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