Since 2009, in order to implement the “Twelfth Five-Year Plan†energy conservation and emission reduction plan, the state's subsidies to the LED lighting industry have continued to increase. Among them, data from the Guangdong Science and Technology Department shows that since 2010, Guangdong has invested 1.35 billion yuan in special funds to guide enterprises and society to invest nearly 6 billion yuan.
In addition, due to the weak global economy, domestic LED product export sales have fallen sharply since the second half of last year. The weak development of the domestic market, coupled with the large amount of bubbles generated by excessive investment in the upstream, has caused many LED lighting companies to face the risk of losing money and even closing down.
Subsidies cause excess?
It is understood that the national round of bidding is to select a number of semiconductor lighting (LED) products manufacturers, products, and determine the supply price. The subsidy funds are indirectly subsidized, and the financial subsidies are given to the winning bidders. The winning bidders then sell the products to the end users at the price of the bidding agreement minus the financial subsidy funds. The ultimate beneficiary is the end user. The country's good intentions can be seen. For the LED industry, the country's huge financial investment has undoubtedly played a very beneficial supporting role. Li Xinghua, director of the Science and Technology Department of Guangdong Province, said that the state's subsidies have strongly supported the innovation breakthroughs in the key areas of the LED industry.
The reporter found that in the third quarter report of a number of LED listed companies, the profit decline was very strong, but despite this, in some companies' net profit, state subsidies occupy a considerable part. For example, Sanan Optoelectronics' net profit for the middle of this year was 460 million yuan, and government subsidies accounted for about half; Dehao Runda's net profit for the middle of this year was 120 million yuan, and government subsidies amounted to 150 million yuan. At the same time, some insiders questioned that although the national starting point is good, excessive investment is a major cause of overcapacity in the industry. “The country’s huge subsidies have made some companies even more motivated to invest, and the terminal’s consumption subsidies have eventually evolved into direct subsidies to production companies.†An industry insider who asked not to be named said that as long as there is government support, companies will see With a good profit margin, it will swarm up and the industry will have excess capacity. After that, it will have to fight the price war. “National subsidies have no fundamental effect on changing the status quo of the market itself. It can only be scratching.†SEI China senior analyst and LED project manager Qi Faxin also expressed his position.
Double investment capacity
Faced with the current status of the LED industry, the industry said that it is not surprising that some companies that operate LED products have suffered losses or even closed down recently, because the industry has been over-invested since 2010.
Wang Luyao, senior analyst of the secondary market of Gaogong LED Research Institute, believes that excessive investment in the upstream industry will lead to losses. Li Xinghua, director of the Science and Technology Department of Guangdong Province, said that the total investment of five provincial-level LED industrial bases in Huizhou, Dongguan, Jiangmen, Nanhai and Zengcheng in Guangdong Province exceeded 50 billion yuan. Among them, Huizhou Career, Zhoulei Technology, Zhongjing LED Chip Project, Guangzhou Zengcheng LED Epitaxial Chip Project and other heavyweight industrial investment projects have a total investment of more than 20 billion yuan. However, he pointed out that the LED industry currently has market chaos, no independent brands, and low consumer acceptance.
At the same time, He Zaihua, a senior researcher at China Investment Consulting, said that the current direct cause of the current LED industry is the overcapacity. There are two main reasons for overcapacity: First, the global economic downturn, which is very unfavorable for domestic LED companies that rely mainly on exports for profit; second, the middle and low-end products in the domestic market are getting together, and enterprises are blindly fighting price wars regardless of quality.
Talent and technology are key
According to statistics, at present, only listed companies in the Pearl River Delta enterprises that are involved in upstream materials and chips are Dehao Runda, Guoxing Optoelectronics and Zhen Mingli. Among them, Guoxing Optoelectronics has a large scale in the midstream packaging industry, and most of the other listed companies still have business. In the field of downstream lighting and applications, companies with a revenue of 1 billion yuan are rare. In other words, most domestic LED companies today do not have core technology.
In the context of the European debt crisis, in the face of the massive subsidies of the government, industry insiders said that LED as an emerging high-tech industry does not mean that there is government support, and that everything is ready for money. The core industry and R&D team are the most lacking in the industry today. Ge Gang, deputy general manager of Beijing Bangliancheng Technology Co., Ltd., said that MOCVD, a key equipment for LED products, is mainly produced by several large companies in the United States and Germany. There is no such manufacturer in China. High-end technology can't get in, and foreign transport will always be backward equipment.
According to industry insiders, LED patent warfare has already started, and the lack of core technicians has become a bottleneck for the development of various enterprises. LED companies want to have good development and must solve the problem of shortage of talents. For the state's subsidy policy, not all enterprises are applauded. A person in charge of the company said that if the state does not subsidize, the company that has been eliminated will naturally “dieâ€, and the “live†enterprise may have the ability to compete with foreign companies. Ability. "The big manufacturers naturally become bigger and bigger. SMEs have neither technical advantages nor capacity scale advantages. The result is to be eliminated. At present, at least half of the current market capacity must be eliminated." Yan Faxin said.
The test of life and death of enterprises
In late October of this year, the third quarter report of LED companies was released: Tianlong Optoelectronics reported in the third quarter of 2012 that the company's current revenue decreased by 76.67% year-on-year; the net profit attributable to shareholders of listed companies was about 32.66 million yuan. Dehao Runda's third quarterly report showed that the company's current revenue decreased by 12.23% year-on-year; the net profit attributable to shareholders of listed companies was about 8.88 million yuan. Tiantong's third-quarter report showed that the company's current revenue decreased by 19% year-on-year; the net profit attributable to shareholders of listed companies was 30.08 million yuan. Of course, LED companies in a loss state are more than these three. It is understood that there are 21 LED companies that have also experienced a decline in net profit.
LED companies' performance this year is generally poor. From January to September, nearly 70% of LED companies' net profit fell, and some of them struggled on the edge of losses. In this regard, Xu Yingsen, chairman of Dongguan Yinghui Lighting, said that since last year, the entire LED industry is in the cold winter, and 50% of the enterprises in the industry are facing a big test.
According to industry insiders, since the second half of last year, due to the weak global economy, domestic LED product export sales have fallen sharply, and the domestic market has become weak. In addition, a large number of bubbles have been generated by excessive investment in the upstream in the past few years, and many companies have lost or even closed down.
He Zaihua, a senior researcher at China Investment Consulting, said that the current disordered development of the LED market, insufficient demand, and the focus on the low-end products are exactly the same as those of the photovoltaic industry. If they are not effectively controlled, they are likely to follow suit.
(This article is reproduced on the Internet. The texts and opinions expressed in this article have not been confirmed by this site, nor do they represent the position of Gaogong LED. Readers need to verify the relevant content by themselves.)
In addition, due to the weak global economy, domestic LED product export sales have fallen sharply since the second half of last year. The weak development of the domestic market, coupled with the large amount of bubbles generated by excessive investment in the upstream, has caused many LED lighting companies to face the risk of losing money and even closing down.
Subsidies cause excess?
It is understood that the national round of bidding is to select a number of semiconductor lighting (LED) products manufacturers, products, and determine the supply price. The subsidy funds are indirectly subsidized, and the financial subsidies are given to the winning bidders. The winning bidders then sell the products to the end users at the price of the bidding agreement minus the financial subsidy funds. The ultimate beneficiary is the end user. The country's good intentions can be seen. For the LED industry, the country's huge financial investment has undoubtedly played a very beneficial supporting role. Li Xinghua, director of the Science and Technology Department of Guangdong Province, said that the state's subsidies have strongly supported the innovation breakthroughs in the key areas of the LED industry.
The reporter found that in the third quarter report of a number of LED listed companies, the profit decline was very strong, but despite this, in some companies' net profit, state subsidies occupy a considerable part. For example, Sanan Optoelectronics' net profit for the middle of this year was 460 million yuan, and government subsidies accounted for about half; Dehao Runda's net profit for the middle of this year was 120 million yuan, and government subsidies amounted to 150 million yuan. At the same time, some insiders questioned that although the national starting point is good, excessive investment is a major cause of overcapacity in the industry. “The country’s huge subsidies have made some companies even more motivated to invest, and the terminal’s consumption subsidies have eventually evolved into direct subsidies to production companies.†An industry insider who asked not to be named said that as long as there is government support, companies will see With a good profit margin, it will swarm up and the industry will have excess capacity. After that, it will have to fight the price war. “National subsidies have no fundamental effect on changing the status quo of the market itself. It can only be scratching.†SEI China senior analyst and LED project manager Qi Faxin also expressed his position.
Double investment capacity
Faced with the current status of the LED industry, the industry said that it is not surprising that some companies that operate LED products have suffered losses or even closed down recently, because the industry has been over-invested since 2010.
Wang Luyao, senior analyst of the secondary market of Gaogong LED Research Institute, believes that excessive investment in the upstream industry will lead to losses. Li Xinghua, director of the Science and Technology Department of Guangdong Province, said that the total investment of five provincial-level LED industrial bases in Huizhou, Dongguan, Jiangmen, Nanhai and Zengcheng in Guangdong Province exceeded 50 billion yuan. Among them, Huizhou Career, Zhoulei Technology, Zhongjing LED Chip Project, Guangzhou Zengcheng LED Epitaxial Chip Project and other heavyweight industrial investment projects have a total investment of more than 20 billion yuan. However, he pointed out that the LED industry currently has market chaos, no independent brands, and low consumer acceptance.
At the same time, He Zaihua, a senior researcher at China Investment Consulting, said that the current direct cause of the current LED industry is the overcapacity. There are two main reasons for overcapacity: First, the global economic downturn, which is very unfavorable for domestic LED companies that rely mainly on exports for profit; second, the middle and low-end products in the domestic market are getting together, and enterprises are blindly fighting price wars regardless of quality.
Talent and technology are key
According to statistics, at present, only listed companies in the Pearl River Delta enterprises that are involved in upstream materials and chips are Dehao Runda, Guoxing Optoelectronics and Zhen Mingli. Among them, Guoxing Optoelectronics has a large scale in the midstream packaging industry, and most of the other listed companies still have business. In the field of downstream lighting and applications, companies with a revenue of 1 billion yuan are rare. In other words, most domestic LED companies today do not have core technology.
In the context of the European debt crisis, in the face of the massive subsidies of the government, industry insiders said that LED as an emerging high-tech industry does not mean that there is government support, and that everything is ready for money. The core industry and R&D team are the most lacking in the industry today. Ge Gang, deputy general manager of Beijing Bangliancheng Technology Co., Ltd., said that MOCVD, a key equipment for LED products, is mainly produced by several large companies in the United States and Germany. There is no such manufacturer in China. High-end technology can't get in, and foreign transport will always be backward equipment.
According to industry insiders, LED patent warfare has already started, and the lack of core technicians has become a bottleneck for the development of various enterprises. LED companies want to have good development and must solve the problem of shortage of talents. For the state's subsidy policy, not all enterprises are applauded. A person in charge of the company said that if the state does not subsidize, the company that has been eliminated will naturally “dieâ€, and the “live†enterprise may have the ability to compete with foreign companies. Ability. "The big manufacturers naturally become bigger and bigger. SMEs have neither technical advantages nor capacity scale advantages. The result is to be eliminated. At present, at least half of the current market capacity must be eliminated." Yan Faxin said.
The test of life and death of enterprises
In late October of this year, the third quarter report of LED companies was released: Tianlong Optoelectronics reported in the third quarter of 2012 that the company's current revenue decreased by 76.67% year-on-year; the net profit attributable to shareholders of listed companies was about 32.66 million yuan. Dehao Runda's third quarterly report showed that the company's current revenue decreased by 12.23% year-on-year; the net profit attributable to shareholders of listed companies was about 8.88 million yuan. Tiantong's third-quarter report showed that the company's current revenue decreased by 19% year-on-year; the net profit attributable to shareholders of listed companies was 30.08 million yuan. Of course, LED companies in a loss state are more than these three. It is understood that there are 21 LED companies that have also experienced a decline in net profit.
LED companies' performance this year is generally poor. From January to September, nearly 70% of LED companies' net profit fell, and some of them struggled on the edge of losses. In this regard, Xu Yingsen, chairman of Dongguan Yinghui Lighting, said that since last year, the entire LED industry is in the cold winter, and 50% of the enterprises in the industry are facing a big test.
According to industry insiders, since the second half of last year, due to the weak global economy, domestic LED product export sales have fallen sharply, and the domestic market has become weak. In addition, a large number of bubbles have been generated by excessive investment in the upstream in the past few years, and many companies have lost or even closed down.
He Zaihua, a senior researcher at China Investment Consulting, said that the current disordered development of the LED market, insufficient demand, and the focus on the low-end products are exactly the same as those of the photovoltaic industry. If they are not effectively controlled, they are likely to follow suit.
(This article is reproduced on the Internet. The texts and opinions expressed in this article have not been confirmed by this site, nor do they represent the position of Gaogong LED. Readers need to verify the relevant content by themselves.)
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