LED financial subsidies introduced in early July or into the cruel shuffling period

The huge cake from the central government will be distributed soon, which will once again help the fiery LED industry.

According to a report from the China Semiconductor Lighting/LED Industry Alliance, the 2.2 billion yuan financial support for supporting energy-saving lamps and LED lamps will be formally introduced in early July. This is also one of the measures of the State Council to promote consumption of energy-saving appliances and other products. The key beneficiary group of subsidies is a large-scale LED company with competitiveness.

The rapid development of the domestic LED industry in these years, there are less than 100 companies involved in this field five years ago, and now has more than 8,000, a large number of hot money influx, so that the entire industry unprecedented prosperity, but also hidden risks, industry reshuffle soon, and A number of large domestic LED manufacturers told reporters that at least half of LED companies will fail in the second half of this year.

The invisible hand behind the government is an important reason for the rapid development of this industry.

A domestic LED manufacturer responsible person told reporters that although at present, China's LED lighting market share is still less than 5%, but the state to promote the technology is unprecedented. "As with the photovoltaic industry, in the initial period, the cost of LED is relatively high. Without the government's financial subsidies and support, it is difficult to open the market in the short term. This mainly depends on policies to influence the market."

According to China's "12th Five-Year Plan" for the development of semiconductor lighting technology, China's LED lighting industry will reach 500 billion yuan by 2015, LED lighting products will account for 30% of general lighting, and 20 to 30 leading players will be trained. The company will build 20 state-level industrial bases and 50 pilot cities of “Ten Cities and Ten Thousand Cities” to promote China's semiconductor lighting industry into the top three in the world.

"At present, LED has just entered the indoor lighting industry. In the next three to five years, it will be a period of large-scale application of LED commercial lighting. Within five to ten years, it will be universally used in home lighting. Now the cost of LED lamps has been higher than Five years ago, it has fallen 10 times. With the further reduction of costs, by 70% of the world's lighting will use LED." Liu Ye, research and development director of Philips Lighting's LED bulb division, told reporters. In his opinion, it is precisely because of this that both the government and the enterprises have taken a fancy to the prospects of LED and have assembled a large number of them.

Yangzhou, a LED company in Jiangsu, told reporters that the city has spent hundreds of millions of financial subsidies in the past two years to support the development of the LED industry, is almost dumping the power of the city. According to the regulations, any company that purchases MOCVD equipment for the production of LED epitaxial wafers will be provided with a cash subsidy of 10 million, of which 40% will be subsidized after the machine is in place, 30% will be trial production subsidy, and the remaining 30% will be after production. All paid off.

According to the plan of Yangzhou City, the first phase of the subsidy amounted to 2.5 billion yuan, which is extremely strong. According to the above sources, because previously in the photovoltaic industry, Wuxi and Suzhou have large-scale industrial chains, and Xuzhou, which is located in northern Jiangsu, has also built a photovoltaic upstream industry. Yangzhou alone has no achievements in this fiery new energy industry. "This makes leaders very distressed and is bound to require a place in the newly emerging LED industry."

After Yangzhou, there are many imitators. Jiangmen City, Guangdong Province also provided LED subsidy for facilities that amounted to Yangzhou's equivalent. Not only that, but also land and other concessions for the project. Anhui Wuhu City and Xiamen Sanan Optoelectronics signed an agreement to subsidize a 12 billion investment project. Then, with the listed company BDO Runda, a subsidy plan for a 6 billion yuan chip project was signed.

One person in the industry believes that local government's promotion based on the performance project has stimulated the prosperity of the industry in the initial stage, but “but it also made the industry full of bubbles at the very beginning”.

Although the battle LED is still in its infancy, it has caused fierce competition for Chinese and foreign capital.

Liang Hanfeng, president of Philips Lighting Division Greater China, told reporters that China has become another global market for the company. In recent years, the company’s business in China has maintained a growth rate of more than double digits. “Last year, the company was in the LED business. The growth rate exceeded 100%. We plan to open 1,000 fashion lighting museums in China to push LED products by 2015. By then, the LED business will account for 50% of the total business volume."

In order to expand its market share, Philips has been providing LED technology and related patents to many lighting companies in the form of paid fees. At present, 200 companies worldwide have obtained production licenses for the company, including Chinese companies. Philips believes that providing technology to other companies can further promote and nurture the market. It can both set a standard for the industry and expand it. The company sells chips, etc.

OSRAM, which is also a giant of the lighting industry, has recently stepped up its pace in the Chinese market. Its LED assembly plant in Wuxi will be put into operation by the end of next year, and Panasonic’s LED light source plant in Hangzhou will also expand its production capacity in the near future. At present, the LED light source produced by the company in China already accounts for more than half of the global production capacity.

Compared with traditional lighting giants such as Philips and Osram, the recent domestic LED lighting companies are roughly divided into two kinds of corporate transformation. One is the traditional semiconductor manufacturers, to the upstream epitaxial wafers, LED chip transition, these companies lack experience, can only produce low-power low-end areas; Second, the traditional lighting companies began to get involved in the LED industry, this part of the original production of traditional enterprises Lamps do not accumulate technically, and therefore the quality of products is not stable.

In the LED industry, the upper reaches are chips, sapphire materials, etc.; the middle reaches are packages and modules; the downstream is lamps, lamps, and system applications, of which the upstream accounts for 70% of profits, and the middle and lower reaches only 30%, and thus the threshold for upstream manufacturing is highest. The main core technology is controlled by Japan's Nichia, Toshiba, and the United States Corey and other companies, Philips is a comprehensive technology is the upstream and downstream take-all, so that the entire industry chain, and domestic companies are serious lack of technology.

However, although there are many differences between domestic enterprises and foreign investment, relying on price wars still has a place in the local market, and it has also become a major source of local government procurement. In the recent Guangzhou Lighting Exhibition, Philips hit a price of 99 yuan a LED energy-saving lamps, then a Shanghai company hit a low price of 100 yuan and 3 LED lights.

However, a lighting industry association official said that there are some domestic cheap LED lighting products are actually at the expense of product quality as the premise, in terms of service life, stability, etc. can not be compared with foreign products, "a lot of advertised LED is a gimmick, quality difference".

Although the outbound subsidy policy is good, it has no connection with SMEs and their exit is close.

According to a person from Foshan Lighting, at present, more than 90% of the 8,000 LED manufacturers in the country are small-scale enterprises, without any core technology, and the products are also put together. Some simply exist to subsidize local government subsidies. Upstream to downstream, there has been a serious excess of production capacity. "The first natural fallout is for small businesses that have no government background."

The person said that the second batch of fallen companies will be companies that have local government support but do not have any core technology. He believes that although local governments can give these companies support in terms of funds and land, they are even willing to pay for government procurement. However, in the end, the strength determines everything, and in the fierce competition, it is inevitable that the bankruptcy is inevitable. "As far as I know, although many companies have governments as their backers, product stocks can't be sold at all. The capital chain has already reached the edge of the break."

Last year, the result of the special supervision and inspection that was disclosed in Guangdong Province caused a great uproar in the LED industry. More than half of the LED light source and LED street light light source controller product quality was unqualified. According to an analysis by a lighting company in Shanghai, there are two reasons. First, in order to reduce costs, a large number of inferior chips are used. Second, most of the purchasers are local companies. Even if the quality is poor, the government takes care of it. For local industries, it is still necessary to receive a single receipt.

The above-mentioned sources believe that the protectionism of local governments can only make these companies short-lived and deepen the government’s financial black hole. “I have surveyed some local lighting companies. The annual R&D expenditures of them are very few, if not more than 100 million yuan. Most of them are few, some are even zero. How do you grab the market with such international giants as Philips and OSRAM?”

Liu Ye told reporters that Philips’ investment in the research and development of LED lamps is hundreds of millions of dollars each year. One of the LED projects that he participated in research and development last year won the “L Prize” contest award from the US Department of Energy, and was also rewarded with 10 million US dollars. However, this project used 120 engineers and lasted for several months, so this bonus and research and development The cost is still not insignificant. In this kind of international competition, it has been difficult for domestic manufacturers to trace.

A large-scale LED manufacturer in Guangdong said that the current surplus is only relative, because the quality of local products is good or in short supply, and there are too many poor quality products. “This will surely go through a round of reshuffling and a large number of SMEs will be eliminated. The mainstream of the market in the coming years will be foreign giants such as Philips and domestic large LED listed companies."

“Last year in Dongguan and Shenzhen, hundreds of lighting companies closed down due to lack of core technology and funding shortages. This has only just begun. At present, at least half of SMEs are hard to survive this winter,” the source said.