The LED packaging market has witnessed steady growth over the past year, says LEDinside, a division of TrendForce. According to LEDinside’s latest industry report, the annual revenue of global LED package market was US$15.975 billion in 2016, and reached US$18.035 billion in 2017. Based on the revenue of 2017, the top three LED package suppliers worldwide were Nichia, OSRAM Opto Semiconductors, and Lumileds, while MLS from China climbed to fourth place thanks to its significant capacity expansion efforts.
According to Roger Chu, the research director of LEDinside, MLS has carried out continuous capacity expansion due to the increasing demand in the market of lighting and display. In the revenue ranking of global LED package market, MLS was the seventh in 2016 and climbed to the fourth in 2017. Seoul Semiconductor has benefited from significant growth in sales of backlight CSP, flash LEDs, lighting, automotive products and UV products, and ranked fifth.
Nichia remained the revenue leader in global LED package market for 2017, but has been challenged by its competitors in the field of blue LED. Therefore, Nichia has actively involved in fields like WCG (Wide Color Gamut) backlight LED, UV LED, blue and green laser, and automotive lighting, while maintaining its market share by holding patent.
Among manufacturers based in Europe and the U.S, OSRAM has the best revenue performance thanks to its long-term and solid foundation in automotive lighting and recent remarkable achievements in infrared sensing. In the general lighting sector, OSRAM now actively launches new products, and outsources the manufacturing of small and medium-power products to OEMs in Taiwan and China, hoping to increase the share in LED lighting market. Lumileds and CREE begin to focus on niche applications such as automotive lighting, niche lighting, and architectural lighting to ensure profitability.
Influenced by Chinese LED manufacturers who offer lower prices, most Taiwanese LED manufacturers have reduced the proportion of low-profit lighting products in their product mixes, and transited to applications with high gross profit. For example, Everlight has been actively developing automotive lighting, UV/IR lighting, and Mini LED backlight applications, hoping to get rid of the Red Ocean.
On the other hand, Chinese LED manufacturers have developed rapidly thanks to the rise of domestic market and the increasing demand for general lighting products and displays. As a result, companies such as MLS and Nationstar continue to expand their production capacity, resulting in their higher revenue ranking. In addition, in recent years, the financial subsidies offered by local governments in China have motivated a large number of Chinese LED manufacturers to increase production capacity. With the cost advantages, these manufacturers have also received many orders from overseas companies. As the result, Chinese LED manufacturers keep moving forward in the entire ranking of revenue. In 2017, the market share of Chinese manufacturers in the global LED packaging market also reached 35%, a five percent increase from 2016.