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16 July 2013

Growth slows for LED backlights in June, as Taiwan’s LED makers flock to the lighting market

Total revenue for Taiwan-listed LED makers fell from NTD10.96bn in May to NTD10.6bn in June, as the LED market was affected by declining demand for backlight application and stocktaking, according to LEDinside (a subsidiary of industry research organization TrendForce). Revenue of listed LED chip makers fell from NTD4.44bn to NTD3.97bn, while revenue of packaged LED makers grew from NTD6.52bn to NTD6.63bn.

Facing falling demand for backlight applications, Taiwanese LED makers have shifted focus to lighting products in the hope that this revenue can compensate for declining revenue from the backlight market. Taiwanese firms including Epistar, Everlight and Lextar have become original device manufacturers (ODMs) or original equipment manufacturers (OEMs) for major international lighting brands to help fill their vacant factory utilization. Besides increasing their utilization rates, such companies will need to focus on profitable products that are sophisticated, offering more differentiation to break free from competitive OEM pricing war, says LEDinside.

Backlight market growth slows in second-half 2013

WitsView (a monitor research subsidiary of Trendforce) has lowered its forecast for TV shipments in 2013 from 216 million (stated earlier this year) to 209 million, with annual growth rate reaching only 1.1%. The main reasons for the reassessment include the uncertain global economic outlook (especially the weak performance of the European market); termination of the Chinese government’s energy-saving subsidies policies, and slowing growth in Chinese TV shipments; and a drop in TV shipment volumes as demand increases for larger TV sizes. For first-half 2013, the LED-backlit TV market’s stock up effect lasted until the end of May, hence the market can only hope that sales exceed the expected targets in second-half 2013.

Small/mid-power LED demand for interior lighting soars; release of LED street-light bidding at end-2013 to drive demand for high-power LED products

There is high demand for small/mid-power LEDs for interior lighting, whether it is light tubes for commercial lighting or directional lighting products (such as PAR lamps, downlight or AR111), according to LEDinside. Major manufacturers such as Samsung and Nichia’s small/mid power lights (especially at warm-white color temperatures) encountered inventory shortages during second-quarter 2013. Packaged LED makers have been promoting new products with better specifications, luminous efficacy and color rendering index (CRI) to meet market demands in second-half 2013. The products are currently in the sampling phase. Once they are launched, it is estimated that the fall in LED package prices will become more evident in third-quarter 2013.

Regarding the high-power LED market, demand is expected to be driven by the Chinese governments’ LED street-light bidding in second-half 2013. LEDinside forecasts that the packaged LED market for lighting applications will reach US$2.98bn in 2013 as a result of these changes.

Tags: LED market


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