According to a survey of a number of LED companies, most companies are experiencing survival, and fierce market competition has prompted a new round of price declines. How to stand firm in the crazy price war and reduce costs are important. Factors, companies with cost advantages will have excellent survivability and sufficient competitiveness, thus benefiting from industry development in the long run.
Reducing costs into an important factor in the survival of LED companies The current price is still the biggest obstacle to the popularity of LED lighting. In fact, after in-depth comparison of the initial acquisition cost of LEDs and energy-saving lamps, power-saving costs, and replacement labor costs, we found that the overall cost of LED lighting is lower than that of energy-saving lamps. The general illumination of LEDs has not been popularized. In the final analysis, the reason is still in the price. With the same light intensity, the initial purchase cost of LED lights is almost twice that of energy-saving lamps. At the same time, the actual use time of the LED is often lower than its rated lighting time, and its energy saving effect is not recognized by the public.
LED manufacturers, especially mid-stream packaging manufacturers and downstream application manufacturers, are actually willing to reduce sales in exchange for price increases. After the price cut, the sales volume can be increased, which is conducive to the scale effect of the manufacturers, thereby enhancing the bargaining power of the upstream chip manufacturers, and finally lowering the cost to hedge the price and maintaining the existing profitability of the manufacturers. From the perspective of Taiwan's LED industry revenue changes, since the Spring Festival of 2011, chip and package revenues have continued to decline, and accelerated from the fourth quarter of 2011, the decline in December 2011 reached the highest in the year, chip revenues The decline was 31, and the package revenue fell by nearly 11. Compared with the inventory, the inventory of Korean, Taiwanese and mainland enterprises was at a historical high, and the destocking process was not over yet, and the price of the product continued to decline. Despite the short-term recovery in LED backlight demand, it is not enough to change the decline of the entire industry. In addition, according to LEDinside's latest price survey report, the average price of LEDs fell by about 10 in the fourth quarter of 2011 due to the impact of inventory clearing. Looking forward to the first quarter of 2012, after the last quarter's quotation fell sharply, coupled with the launch of new products, It is estimated that the average price drop in this quarter is expected to shrink.
Cost reduction can be started from the following aspects. The first is large-scale production and improved yield. In this sense, the higher the scale of revenue, the more obvious the advantages, such as Sanan Optoelectronics, Hongli Optoelectronics, and Guoxing Optoelectronics. The second is to reduce costs through technological innovation, which is divided into three sub-levels, including reducing the cost of epitaxial wafers, reducing packaging costs, and reducing sales costs. Enterprises that can achieve upstream and downstream integration will have more room for cost improvement. Domestic companies include Dehao Runda and others. Dehao Runda fund-raising project plans to produce epitaxial wafers in a large scale, covering the entire LED industry chain, as well as supporting sales channels and products of the same specifications. The cost can be saved by 10-20. The packaging cost and lighting cost depend on the manufacturing capacity of the enterprise. And management level, leading companies in this area include Qinshang Optoelectronics and Ruifeng Optoelectronics.
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