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keyword:Roger Chu27 result(s)

Press Releases
TrendForce Reports Global LED Market Value at US$14.32 Billion in 2015 with Industry Posting Its First YoY Decline

2016/04/08

LED

The latest report from LEDinside, a division of TrendForce, finds the total value of the global LED market (include both visible and non-visible LED products) arrived at US$1432 billion in 2015, representing YoY growth of -3% The market witnessed its first annual decline in value last year mainly because of the price war among the LED manufacturers, with the ASPs of some mainstream LED packages suffering a drop of 40% or more compared with 2014 The rising US dollar also resulted in falling revenues for many manufacturers LEDinside Research Director Roger Chu explained that there were three major factors behind the negative growth in market value for 2015: 1 Decrease in LED usage volume due to technological advancements: The introduction of flip-chip LED technology into the TV application, for example, has caused further reduction of LED usage volume for LED backlight units 2 The rise of OLED as the replacement technology: With the maturation of OLED technology, an increasing number of branded smartphone vendors are considering using OLED panels to differentiate their products Since OLED panels are self-illuminating and do not require LED backlight units, they will eventually simplify mobile backlight design 3 Oversupply: The current price war in the LED market is the result of the industry experiencing oversupply and excess capacity While the usage volume of LED lighting products continue to expand, falling prices constrain the growth of the overall market value On the whole, Chu expects the demand for LEDs to keep growing in 2016 Most applications, such as general lighting, automotive lighting and LED displays, will see increases in the LED usage volume LED backlight will be the exception as the emergence of OLED technology will cut the LED usage volume for this application The ongoing supply-demand imbalance means that LED manufacturers are still under pressure to lower their prices this year However, the market already experienced an excessive level of competition last year, resulting in many LED products selling at a loss (some prices are even near the products’ cash costs) Further price declines will therefore be limited The LED industry faces the end of more than a decade of high growth as demand slows down in various applications The LED industry has always enjoyed high growth since the beginning because different applications have emerged to sustain the overall demand LED backlights, for instance, is used to illuminate various devices, from the keyboards and screens of mobile phones to LCD TVs and even the touch displays of smartphones and tablets Likewise, LED lighting has made significant market penetration LEDinside’s data reveal that the global LED market value, on average, has been growing at a CAGR of about 20~30% over the past ten years and more The first negative YoY growth appeared in 2015 and was mainly attributed to slow down in major application markets

Press Releases
Saturation of LED Market Will Drive Industry to Seek Profits in New Applications in 2016, Says TrendForce

2015/11/30

LED

Light-emitting diode (LED) manufacturers had an especially tough year in 2015 “Despite rising LED lighting market demand and the large scale replacement of traditional lighting products, the oversupply situation has caused the average LED sales prices (ASPs) to plunge 30% to 40% year on year,” said Roger Chu, research director for LEDinside, a division of TrendForce “Growing number of manufacturers have incurred heavy losses and exiting the market” LEDinside estimates that the value of the global high-brightness LED market will increase by just 2% year on year to US$1452 billion in 2015 and by another mere 3% year on year to US$1495 billion in 2016 Even though lighting demand has spurred LED usage volume growth, the ongoing increase in LED’s luminous efficacy has the opposite effect of reducing usage volume Additionally, LEDs are still under an immense downward price pressure Based on these observations, LEDinside projects that in the next five years the LED industry’s compound annual growth rate (CAGR) is unlikely to reach more than 10% as before Listed below are five major trends that will shape the LED industry in 2016: Price decline to moderate in LED market as more manufacturers make their exits Demand in LED backlight and lighting markets has been lower than expected this year, which has caused sliding ASPs of LED chips and LED packages This trend has been markedly observed during this year’s second half, when LED chip and package prices have sharply plunged to point that prices of some products are now close to material costs Facing losses, manufacturers are being pressured to lower their prices in the short term However, prices are now almost equal to production costs for many of them As more companies drop out of the chip and package markets, further LED price cuts will be limited Chinese LED manufacturers start acquiring foreign companies to transform their business models Chu noted that Chinese LED enterprises are now in a strong position to make merger and acquisition deals after raising funds from the stock market and receiving government backing Their targets are major international LED players’ patents and lighting brands, which the Chinese hope will strengthen their patent portfolios and overseas distribution channels Additionally, more Chinese LED manufacturers are also transforming their business models Mergers and acquisitions are a way for them to leave the hotly contended red sea markets and enter other market sectors Penetration of flip-chip technology in LED TV backlight application will keep rising Previously, only a few manufacturers highlighted their flip-chip LEDs as major products due to low yield rates, production costs and other technology challenges However, an increasing number of Taiwanese and South Korean manufacturers begin to invest in the R&D of this technology starting in 2014 Consequently, flip-chip products have gradually become more efficient and profitable as their quality improves and costs go down This year, South Korean LED manufacturers started to apply flip-chip LEDs on a large scale in TV backlight South Korean branded TV vendors have also significantly raised their usage of flip-chip LEDs as the source of LED backlight LEDinside expects that LED manufacturers will continue their aggressive promotion of flip-chip and the even smaller chip scale package (CSP) LEDs in the TV backlight market Hence, the penetration of flip-chip technology in this application is projected to exceed 50% by 2017 Replacement of traditional lighting products to accelerate as prices of LED lighting products continue to decline LED lighting replacement products (eg LED bulbs and tubes) are becoming more standardized and have been eagerly promoted by many branded lighting companies As a result, LED bulb prices around the globe are nearing their traditional, energy saving counterparts Lighting companies will continue to find cost-cutting solutions in 2016 They will not just be looking at the cost of LEDs when it comes to lowering the price of an entire LED lighting product They also consider lowering the costs of driver and other components Bringing costs down help with efforts to lower product prices, which in turn expand sales and market share LEDinside expects LED lighting replacement products to be widely adopted in the next three years Non-visible LED light increasingly valued in special applications Due to the intense LED pricing competition in the white LED market, LED manufacturers are searching for innovative or special lighting applications to boost profitability Some of the newly emerged applications that have drawn manufacturers’ attention are related to non-visible light spectrum, such as ultraviolet (UV) and infrared (IR) LEDs Compared with lighting or backlight applications, the non-visible light applications are very limited in their market sizes However, UV and IR LED markets have a very high technology barrier and production is highly customized LED manufacturers supplying these application markets will need to work closely with solution providers/system manufacturers On the other hand, non-visible light LEDs will have significantly higher gross margins than white LEDs UV LEDs, for example, currently has exposure and curing as its largest application markets, but manufacturers are also paying attention to other applications such as disinfection Developing LEDs of UV-C wavelength, which is suited for disinfection, requires manufacturers to overcome an exceptionally high technology barrier Though the UV-C market has relatively few players, the number of active entrants is expected to increase IR LEDs have a broad range of applications Primarily, they are used in remote controls or security/surveillance solutions They are also present image sensors, motion sensors, position detection sensors, proximity sensors, biometric recognition systems and photoplethymography sensors (which measure a person’s pulse rate and blood oxygen level) IR LEDs will also find value-added applications in handheld devices, such as information security and health management On the whole, the IR LED market is highly profitable and has lots of room for growth on account of the technology’s diverse uses

Press Releases
LED Chip Market Sees Oversupply as China Accounts for 47% of Global MOCVD Capacity, According to TrendForce

2015/09/18

LED

According to the latest 2015 Global LED Industry Supply and Demand Database Report by LEDinside, a division of TrendForce, capacity expansion efforts of Chinese LED chip manufacturers have resulted a supply glut with this year’s LED chip supply-demand ratio reaching 22% LEDinside also estimates that the global MOCVD installed volume in 2015 will grow to 3,130 chambers, among which 1,473 are located in China and will account for 47% of this year’s global MOCVD capacity (MOCVD systems used in the calculation are of the K465i model) Roger Chu, research director at LEDinside, pointed out that this year’s MOCVD capacity is equivalent to 7231 million pieces of 2-inch LED wafers, representing a 14% increase in output volume over 2014 Chinese chip manufacturers such as San’an Opto and Changelight in particular are producing with the latest MOCVD systems in their newly built plants in Xiamen Based on LEDinside’s projection, the monthly wafer capacity during the second half of 2015 will increase by as much as 500,000 pieces, creating a huge impact on the entire chip industry’s supply and demand situation Due to government support and fundraising in the stock market during recent years, Chinese LED chip manufacturers are able to expand their capacities to the point of creating a supply glut Therefore, the strength of these enterprises cannot be judged by past records San’an Opto, the largest Chinese LED chip manufacture, is a prime example In the past few years, local governments in China have been providing San’an Opto subsidies that have made up 10~14% of the company’s annual revenues Moreover, San’an Opto’s market value has been rising sharply since 2014, and this in turn has attracted more and bigger investments In the overall competition, Chinese LED companies have fewer patents and smaller customer base than their global competitors, but they have significant strength as they are backed by a continuing stream of investments Taiwanese LED companies by contrast have seen their market values falling followed by exodus of their talents and fundraising challenges Consequently, they resort to layoffs and unpaid furloughs as means to reduce cash outflows As the oversupply situation remains unresolved, industry participants in the future will have to differentiate themselves by developing distinct products or niche applications in order to get around highly saturated and competitive markets For this point on, their strategies will change from focusing on market scale and market share to generating stable profits to ensure sustainable development

Press Releases
TrendForce Reports LED Package Prices Continue to Slide

2015/05/12

LED

The LED package prices continue to fall in the second quarter, according to the latest price report from LEDinside, a division of TrendForce Compared with the prior quarter, the average LED price for the lighting application products has fallen by 1~9%, excluding the package specification 2835 Since the 2835 LED products are the mainstream in China’s lighting market, their average price decline has reached 10~17%, more severe than products of other package types For the backlight LED package products, their average LED price has dropped by 3~6% during the second quarter The price competition in the direct-type LED backlight market remains the fiercest this year versus markets for other types of LED packages  Roger Chu, research director at LEDinside, stated the second quarters of the past years were usually the peak season for the LED market, but for this year’s the demand growth has been considerably weaker The main factor behind this is the volatile global economy, which in turn causes big exchange rate fluctuations in several regions Currency depreciations in Europe, Japan, and the emerging markets have made imports of LED bulb and other electronic products more costly for the consumers Consequently, demands are scaled back and LED manufacturers are now undercutting each other in order to maintain their capacity utilization rates The price lowering has also meant that the manufacturers are shifting their strategies and focusing on the niche market, which covers automotive LED, UV, IR, flip-chip, CSP, and other highly profitable LED products Aggressive expansion into the niche market will help boost the manufacturers’ margins  The quarterly price drop-off for products of the 05W 2835 LED have reached 17% because they are currently the main offerings of many Chinese LED manufacturers Consequently, the price competition among the 2835 products is quite intense Both the 1W 3030 LED products and the 1-5W high power LED (ceramic substrate) products have seen an average price decline of 9% in the second quarter By contrast, price changes for the rest of the LED products have been relatively small “Although the market gradually recovered after the Chinese New Year holidays,” said Chu, “the demands were not as robust as during the same period of last year, so LED manufacturers had to slash prices”  For the LED backlight market, its growth this year has been slower than the previous because the end market demand picked up much later and changes were made to China’s LED subsidy policy LEDs for the direct-type TV application have experienced the greatest quote price decline in the second quarter, with packages 3030, 2835, 3535 and 3228 fallen to US$025~03/pc The LED package price for mid-range and low-end TVs has dropped by nearly 6% quarterly The 7020 package, which is the mainstream for the edge-type TV application, are priced around US$0085~0095/pc The end market prices for edge-type TVs are higher due to the applications of advanced technologies and design concepts like high resolution, high color saturation, curved screen, and thin body LED package price for the edge-type TV application in turn experienced lesser downward price pressure 

Press Releases
Osram Licht AG to Focus on Automotive Lighting, Smart Lighting and LED Components After Parting Its Lighting Business, TrendForce Says

2015/04/22

LED

Osram Licht AG yesterday (April 21) has announced that it is proceeding with the next phase of its corporate reorganization, sending a shockwave across the LED industry The announcement from Germany-based lighting giant follows Dutch electronics company Royal Philips ’ sale of its automotive lighting and LED components businessThe underperforming divisions that Osram will let go are Classic Lamps & Ballast (CLB unit) and LED Lamps & Systems (LLS unit) They account for 40% of the company’s total revenue The divisions that Osram deems valuable and will hold on to are Opto Semiconductor (OS unit), Specialty Lighting (SP unit), and Luminaires & Solution (LS unit) Roger Chu, research director at LEDinside, a division of TrendForce, said Osram was spun off from Siemens in 2013 following the latter’s decision to focus on core businesses Since then, Osram is listed as an independent company with a century-old brand name in lighting Chu further stated Osram is again forced to spin off or sell part of its business as it faces significant challenges in the fiercely competitive market, retaining only the core and profitable units With this restructure, Osram will concentrate on automotive lighting, project-based smart lighting solutions, and advanced light source technologies (such as LED and laser) These business operations target the business-to-business market, which offers higher profit margins as well as presenting higher technological thresholds for market entrants According to LEDinside, the LED lighting industry’s market value reached US$21 billion in 2014 with LED light bulbs accounting for 37% Especially since the beginning of 2011, LED light bulbs had their prices reduced by 30% annually "Although falling prices stimulated strong demands, price wars kept eroding industry players’ profit margins," said Chu The profit and shipment growths of LED bulbs cannot compensate the market decline in traditional lighting products, and this is the main factor behind the recent actions taken by Osram and Philip  The decisions made by Royal Philips and Osram Licht AG show that these major players in the lighting industry do not see a rosy future for LED lighting LEDinside considers two types of candidates available for future takeovers of these companies’ lighting business divisions The first group will be Chinese lighting companies that have the cost advantage and the ambition to become global enterprises The other group will be big global tech companies that are not originally in the lighting business These companies, however, are willing to branch out into this field to pursue dominance in other emerging sectors, such as smart home The direction that of the LED lighting industry will take in the future depends on the kind of strategic partners that will acquire the Osram’s and Philips’ brands Figure: LED Light Bulb Price Trend, 2011-2015

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