[Industry Analysis] "2017 LED Development Status and Trends"

TUV Rheinland Group (hereinafter referred to as “TUV Rheinland”) officially released the “2017 LED Lighting Industry White Paper” to help LED lighting industry chain companies, research institutes, sales companies and investment companies understand the latest developments in the LED lighting industry. Market opportunities, make correct business decisions, and clarify the direction of business development.

Based on TUV Rhein's years of leading experience in the LED lighting industry, this white paper summarizes and explains the current status and future development trends of the global and Chinese LED lighting market, and analyzes the different product manufacturers in the supply chain with reference to relevant regulations and standards in Europe and the United States. Face the quality test. Finally, practical countermeasures and suggestions are proposed for products in different application fields.

LED lighting market status and trends

With the continuous development of lighting energy-saving technology, the protagonist of the traditional lighting market is being converted from incandescent lamps to LEDs. It is estimated that by 2020, the global LED lamp production will exceed 7 billion baht. According to research firm LEDinside, the penetration rate of global LED lighting in 2017 is about 39%, and will exceed 50% by 2019.

China is an important global LED lighting production base, with production accounting for more than 80% of global production. China's LED lighting industry has developed for several years, and its number is large, but manufacturers with brand and channel advantages are the main players in the market.

Demand for scientific and technological innovation continues to increase

This year, LED plant lighting swept with a dazzling aura. At present, the global lighting manufacturers are accelerating the layout of plant lighting, and a competition without smoke is quietly going on.

Second, in the field of visible light communication, many giant companies have already laid out. Some industry experts believe that LED as a visible light communication source is ubiquitous, and its number is more than 10,000 times that of wireless communication base stations and access hotspots. It will greatly promote the marketization of visible light communication, and realize the depth of illumination and communication. The integrated visible light communication can also expand the LED market and further increase the added value of the industry.

Third, as the leading technology in the field of vehicle lights, LED lighting technology has become an important trend in the development of future car lights with its strong technological advantages. Major LED manufacturers are exploring new blue ocean markets, seeing the broad development prospects of LED automotive lighting, and accelerating the layout of automotive LEDs.

Intelligent lighting is the main development direction of LED lighting

With the widespread application of next-generation information technologies such as the Internet of Things, next-generation Internet, and cloud computing, smart cities have become an inevitable trend and have been gradually realized in various practices. Smart lighting has received extensive attention from LED companies.

We interpret the smart city part to see that smart lighting is the main development direction of LED lighting. It is estimated that by 2020, the global smart lighting market will reach 13.427 billion US dollars. However, China's smart lighting market is still in its infancy, the industrial order is chaotic, the standards are not yet perfect, and the business model is still groping. The industry needs to overcome these difficulties before it can develop healthily.

Throughout the international lighting giants, Philips Lighting has pioneered a new model in the smart city field, collaboratively building a smart city backbone network to promote China's smart city infrastructure construction and application development. A spokesperson for OSRAM once said that OSRAM will focus more on the needs of “smart cities” and “smart buildings” to meet the growing demand for smart connected lighting solutions.

The advancement of LED technology and the reshuffle integration of the industry in recent years have enabled the LED industry to enter the stage of product upgrading and diversification. Firms that are self-styled will not be able to survive, but will focus on new products and new technologies, and enterprises that focus on improving product quality will gradually grow, and corporate profit margins will also increase.

TUV Rhein proposes four major LED transformation directions

The advancement of LED technology and the reshuffle integration of the industry in recent years have enabled the LED industry to enter the stage of product upgrading and diversification. Firms that are self-styled will not be able to survive, but will focus on new products and new technologies, and enterprises that focus on improving product quality will gradually grow, and corporate profit margins will also increase.

In this white paper, TUV Rhein proposes four directions for product differentiation, entry into new areas, intelligence and development of emerging markets, and gives specific recommendations.

In the highly competitive LED lighting market, LED companies can only obtain the corresponding certifications in the first time by grasping the new international regulations and new requirements in advance, and seize new market opportunities to achieve greater development in the international market.

2018 lighting market development three main lines: smart lighting, niche lighting, emerging national lighting

LEDInside's latest '2018 Lighting Grade Packaging and LED Lighting Market Outlook' by TrendInce's Optoelectronics Research Center shows that the LED lighting market has gradually increased in size from 2016 to 2019. The LED lighting market reached US$32.17 billion in 2018 and US$33.3 billion in 2019. Lighting has entered a period of saturation; industrial, landscape outdoor, special commercial lighting continues to develop.

According to LEDinside survey of global installed lighting products, LED lighting products have rapidly increased the replacement of traditional lighting. The penetration rate in 2017 is 22%, and it is estimated that it will reach 63% in 2022. The CAGR of LED lighting products will reach 26% in 2017~2022. .

2018 lighting-grade packaging market value reached 7.16 billion US dollars

The lighting grade packaging market output value exceeded 10% in 2017, and the expected growth rate in 2018 is close to 7.8%, reaching 7.16 billion US dollars. Alternative light sources such as bulbs and tubes enter saturation; industrial lighting products such as patio lights, and commercial lighting products such as troffers, panel lights, filament lamps, etc. still have a CAGR of around 30%. The 2016-2021 lighting grade LED package has an overall CAGR of 4%.

Light quality is still the focus of the market. High color rendering LEDs refer to LED package products with CRI above 90, which are currently used in high-end commercial lighting markets where color reproduction and light quality are more critical, such as museum lighting, retail lighting, food lighting, etc. High color rendering LEDs currently account for a small market, and the global market size in 2017 was approximately $330 million. However, with the increase in market demand and the development of packaging technology in the next few years, it is expected to show rapid growth.

2018 lighting market development three major spindles - smart lighting, niche lighting, emerging national lighting

Spindle 1: Smart lighting

In 2017, global smart lighting entered a stage of rapid development. The market scale is close to 4.6 billion US dollars, with a year-on-year growth rate of 95%. With the maturity of technology and products and the spread of related concepts, it is expected to reach US$13.4 billion in 2020. Industrial and commercial are the largest application areas for smart lighting. Because of the digital characteristics, smart lighting will bring more new business models and value growth points to these two fields.

Spindle 2: Niche Lighting

LEDinside organizes the four niche lighting markets, including plant lighting, medical lighting, fishing lighting and marine port lighting. Among them, the US and Chinese markets have rapidly increased the demand for plant lighting, and plant plant construction and greenhouse lighting demand are the main kinetic energy.

Spindle 3: Emerging National Lighting

The economic development of emerging countries has driven infrastructure and urbanization rates, and the construction of large-scale commercial facilities and infrastructure and industrial zones has stimulated demand for LED lighting. In addition, national and local governments' energy conservation and emission reduction policies such as energy subsidies, tax incentives, etc., large-scale project such as street lighting, residential and commercial district renovation, and the improvement of lighting product standard certification are promoting LED lighting promotion. . Among them, the Vietnam market and the Indian market in Southeast Asia are the fastest growing.

Analysis of the development strategy of lighting manufacturers under the post-lighting era

First: Due to the high production capacity of traditional lighting, international lighting manufacturers have gradually transformed LED lighting and have far-reaching plans for LED lighting products. The proportion of LED lighting revenue growth is not as good as the manufacturers' own expectations, so it will accelerate the LED lighting business. Innovation and growth to achieve profitability goals. Representative manufacturers such as Philips Lighting, OSRAM Licht AG, GE (Current), LEDVANCE.

Second: The regional development of the lighting manufacturer, known as the national representative team or Local King, with the support of the national government, to block foreign manufacturers by means of specifications, standards, tariffs, etc., and to provide policy incentives, subsidies, etc. Encourage local lighting manufacturers to rapidly develop lighting products. Representative manufacturers are Acuity Brands, Panasonic, TOSHIBA, Feile Audio, Op Lighting, etc., and the penetration rate of LED lighting is as high as 60%-70% in 2016.

Third: With niche advantages, especially channel advantages, technical assistance, and access to special markets and other emerging lighting manufacturers, both bulbs and lamps can use LED lighting products from the beginning, and the contribution contribution is quite sufficient. Mainly representative of manufacturers such as Feit Electric, Iris Ohyama, etc., but revenue and profit because the manufacturing cost is not competitive, the performance is declining year by year.

Fourth: Enterprises that have transformed their mid-upstream production or foundry business into brands, such as Mulinsen, CREE, Sunshine, and Lidaxin. Based on the global market for the largest production and manufacturing of global lighting, Chinese lighting manufacturers have taken advantage of the scale advantages of manufacturing costs, which has created a solid foundation for Chinese lighting manufacturers to enter the global market.

Source: CIC Investment Advisory Network