The development of China's LED industry in 2019

Due to the energy-saving and environmentally friendly, the penetration of LED lighting products into the traditional lighting market is the trend of the times. The replacement of traditional lighting products by LED lighting products will continue to be supported by policies. Overall, China's macro economy is in a relatively stable growth period, providing a good environment for the development of the industry. In addition to regular lighting applications, the gradual development of automotive lighting, plant lighting, IR/UV LED, medical lighting and other market segments will stimulate broader market demand.

From the perspective of the global LED industry chain, Chinese companies are dominant in the global industrial chain, from upstream chips to midstream packaging to downstream applications. In 2018, Sino-US trade frictions, the United States imposed tariffs, overseas LED companies faced the problem of rising raw material costs brought by tariffs, but Chinese companies still have a large competitive advantage.

The favorable factors of the LED industry are:

1. National industrial policy support.

LED is more in line with future market trends due to its energy saving and environmental protection properties. The state has introduced a series of encouraging policies to support industrial development. At the same time, in the context of the country's encouragement of exports, LED lighting products enjoy preferential policies for export tax rebates. The export tax rebate rate for LED display products is 16%, and the export tax rebate rate for LED bulbs, LED light strip products is 13%. Under the background of industrial policy support, the scale of the industry is expanding day by day, and the industry chain is becoming more and more complete, which has created favorable conditions for enterprises in the industry to improve their competitiveness and participate in international competition.

2. A wide range of products and broad market prospects.

LED applications are in the ascendant, widely used in landscape decorative lighting, large-screen display, traffic lights, digital display and indicator lights for home appliances, car lights, mobile phones, digital cameras, computers, LCD TV backlights, and other fields. With the development of technology, LED has also appeared in new application directions, such as aerospace, medical, agriculture, and other fields. The market share of LED in various fields has steadily increased and the emergence and development of emerging application fields have created a good market space for the development of the LED industry. In the future, the construction of national affordable housing projects, rural infrastructure construction, railways, highways, and airports will be steadily advanced. These major investments will produce various LEDs including display screens, special lighting, general lighting, landscape lighting, etc. Application product demand pull.

3. Upstream technology continues to improve, and cost reduction boosts industry demand.

As the cost of the upstream technology advances in the industry declines, the breadth and depth of market demand will be further expanded, and the market substitution effect will be released to a greater extent. The upstream and downstream of the LED industry chain will achieve positive interaction, new products, and new technologies will be rapidly promoted, and the market of downstream application industry will be further subdivided, and the market capacity of the entire industry will be further improved.

4. The downstream industry standards are constantly improving, and standardized development has become the director.

With the wider application range of applications, such as outdoor advertising and stadiums have gradually established relevant management specifications. In addition, the Ministry of Railways, the Ministry of Communications, the Ministry of Public Security, etc. have also established relevant standards for LED applications. The establishment of the above industry standards and specifications will help promote the orderly and standardized development of the LED lighting industry.