The price increase of the chip pushes the small and medium-sized manufacturers to be eliminated, and the emerging market becomes a profitable shortcut.

Looking back on 2016, after another year of baptism, the LED industry has gradually begun to recover. The average selling price of packaged LED products has stabilized for highly commercialized inventory units such as low-power 2835 and medium-power 5630.

In addition, although the demand for high-power LEDs for lighting applications is bullish, competition in this area is still fierce.

In 2017, with the further deepening of the supply-side reform, the supply-demand relationship will be further improved, and the low-end backward production capacity will be further eliminated. At the same time, a number of large-scale plants are still increasing their investment in capacity expansion in their supply chains.

For the time being, some of the upstream chip and material manufacturers no longer continue to sacrifice profits to lower prices, resulting in increased LED packaging costs. However, part of the downstream lighting application demand and price expectations have not seen a significant increase, so packaging manufacturers face greater profit and order pressure.

So, what is the packaging market in 2017, facing the further reshuffle of the packaging industry, how will the packaging manufacturers survive next, let's see what these packaging manufacturers say?

Guoxing Optoelectronics related person in charge

In 2016, LED segment display, LED car lighting, LED mobile phone flash and other market segments have received much attention. In 2017, the above market segments will continue to develop rapidly. In addition, innovative applications such as agricultural lighting, light medical, visible light communication, sterilization and sterilization will also usher in new growth.

In view of the significant growth in demand for downstream applications such as LED lighting, large-size LED displays and LED automotive lighting, it is expected that the LED packaging market will continue to grow in 2017 and industrial concentration will be further strengthened.

Next, large enterprises will use the capital market to further pool their superior resources and continue to grow bigger and stronger. SMEs are turning to high-margin market segments and doing fine-grained projects to seek development.

Guoxing Optoelectronics invested 640 million yuan last year to expand its packaging and component projects, and its LED packaging production capacity has expanded by 40%. In 2017, Guoxing Optoelectronics will continue to expand and win a broad space for future development.

Regarding the price increase of the package, as far as the current market trend is concerned, the price of the packaged device will continue to rise. In fact, this is also a reflection of the industry's gradual improvement.

In the second half of 2016, Guoxing Optoelectronics also conducted a price adjustment based on the rising price of raw materials for packaged devices. At present, the company's orders are full, the supply of related materials is normal, and the scale of production continues to expand.

Regarding product layout, in 2017, Guoxing Optoelectronics will continue to adhere to the development strategy of “based on midstream packaging, taking into account upstream chips and downstream lighting applications”, and targeting different application areas of the midstream packaging market. On the one hand, keep the display device package and white light package go hand in hand, and simultaneously expand the emerging markets such as special lighting, automotive lighting, and plant lighting; on the other hand, we will continue to pay attention to the development of innovative fields, actively carry out technical reserves, and timely cut in.

It is predicted that the supply and demand relationship of LED market will be further improved in 2017, and the market scale will continue to grow, but the growth momentum will slow down and industrial development will become more rational and enter a steady development stage.

In addition, it is expected that the trend of industrial integration will continue in 2017. Through mergers and acquisitions, the concentration of industry will be further strengthened. The trend of the larger Evergrande will be more obvious, and the scale of the industry will also be significantly improved.

Finally, although the LED industry is developing well in 2017, it is necessary to guard against the challenges and impacts of emerging technologies such as OLED, Micro LED and laser lighting. Therefore, LED companies need to continuously improve their technical strength to cope with it.

Jingke Electronics related person in charge

In recent months, the prices of precious metals such as gold and silver have continued to rise, and the cost of gold wire and silver brackets, the core components of LED devices, has also risen. In addition to the precious metals required for the products, LED chips, the key component of LED devices, have also risen sharply due to the rising price of sapphire substrates.

Of course, the price of high-quality chips that Jingke Electronics has chosen has also risen by one liter. In view of the strategic partnership with chip manufacturers, the price of packaged devices has been minimized.

From the perspective of the successive price increases of Jingdian and Sanan, the upstream chip factory is in the stage of integration. In order to seize market share, various manufacturers use the method of suppressing price to operate. After several years, as the middle and upper class of the peers. The chip factory is either acquired or closed down.

On the other hand, this collective price increase is also a good thing for the entire industry, which is conducive to a virtuous cycle of the upper, middle and lower reaches. At the same time, through this "price surge", we warn everyone not to continue to survive by price cuts, because it turns out that this is only a short-term interest and cannot achieve long-term development.

Looking forward to 2017, the LED market competition is still fierce. Many manufacturers will accelerate their transfer to niche markets such as small-pitch display, infrared and ultraviolet LEDs for profit. The estimated output value will reach US$15.4 billion, up 4% year-on-year.

Up to now, Jingke Electronics has accumulated a certain market in the two fields of LED white light chip and package light source. This year, Jingke Electronics will continue to focus on the traditional white light lighting and TV backlight market with capital and technical advantages. In addition, Jinko Electronics will focus on high-tech semiconductors such as third-generation semiconductors and LED lamps, and strive to serve customers and create higher value for shareholders.

Next, with the continuous development of LED technology, the LED packaging field has gradually developed from the traditional fields of illumination, backlight, indication and other fields to infrared/ultraviolet, automotive lighting, plant lighting, indoor small spacing, etc. The more you come, the more professional you are, which also distracts the capacity of future packaging plants. In the long run, white LED is still the focus of market competition, and it is also the largest market in the application field.

Wang Mengyuan, general manager of Zhonghao Photoelectric

In 2017, as raw material costs rise, competition continues to escalate, and profit margins become smaller, small packaging plants without core competitiveness will gradually be eliminated by the market. As a result, many vendors will develop new market segments to differentiate them from major packaging companies to capture profit margins.

Next, LED packaging product technology will also develop toward high power density, high light efficiency, high color gamut index integration and miniaturization.

The price increase of packaged products is still continuing. As far as the current market situation is concerned, the price increase is also a process in which the market returns to rationality.

On the one hand, the price increase of packaging is due to the increase in the comprehensive cost of materials; on the other hand, for some price-sensitive markets, in the past, excessive competition for low prices and subsidies to the market have gradually returned to rationality. However, it is difficult to say how long this situation can last, because technological breakthroughs can reduce costs, and it is normal for a mature product to fluctuate at a price of around 10% with the price balance curve.

Although the cost is rising, we still insist on the same price. In the future, if the price of raw materials changes drastically, we will also formulate the best price adjustment plan.

COB packaged devices are the key layout products of Zhonghao Optoelectronics. From the market trend in the last three years, COB has a compound annual growth rate of 13%, and has been widely used in the field of lighting products. It is estimated that the output value of COB this year will reach 30% of the output value of LED package.

In 2017, the COB packaged device market will have the following changes:

1. With the development of packaging equipment, materials and flip chip technology, flip-chip COB will be applied on a large scale;

2. The higher integration of COB light source will gradually be recognized by the market;

3, more manufacturers to transform, seeking new application market, products will also involve more market segments, such as UV UV applications, infrared sensing applications, intelligent lighting applications.

At present, Zhonghao Optoelectronics COB product performance and other indicators have reached the forefront of the industry, multi-series products have passed the LM-80 6000 hours of routine testing in 2016, and some products completed 9000 hours of testing. In 2017, Zhonghao Optoelectronics will focus on the high-density flip-chip lamp COB and flip-chip outdoor COB, which is supplemented by the wide color gamut commercial photo COB and special lighting products.

It is expected that the LED market will return to rationality in 2017 and resources will be more concentrated. Under the pressure of cost, some SMEs will launch the market, the downstream application market will completely eliminate incandescent lamps, and application demand will continue to rise.

Dong Yiguang Electronics Sales Director Zhou Aimin

In 2017, the packaging market will show a steady upward trend, and market demand will increase steadily compared to last year. As the price of chips rises, several packaged products will also rise structurally, but the increase will not be too large.

With the price increase of Mulberry and other large packaging companies, the corresponding products will be affected to some extent, such as patch 0.2w and other related products. Dongxun Optoelectronics has adjusted the price of the full range of products last year and will not make any major adjustments this year.

For CSP, last year we have made a relatively complete layout on the product structure, and a single power has formed a complete series from 0.2w-20w. In 2017, Dongpu Optoelectronics will optimize the production process of CSP and improve the cost performance to meet the growing demand for CSP in the current market.

It is expected that this year's CSP market will have a substantial growth, mainly in the field of industrial lighting, special lighting, car headlights and other suitable for CSP products.

In order to meet the market demand, in 2017, Dongpu Optoelectronics will deepen the ceramic 3535, 2525 series products and CSP series products, and the 3535/2525 series will become a new breakthrough market product. Regarding the CSP series products, we will optimize according to market demand and launch products suitable for customers' needs.

Next, Donghao Optoelectronics will focus on deepening customer needs to meet the market's characteristic needs.

It is worth mentioning that in 2016, Shuguang Electronics has completed the R&D and trial production of CSP's new generation products, and we will mass produce when the market is heavy; other integration, COB, module products, etc. will be more customized and satisfied. The needs of special markets.

For the 2017 LED market, the forecast price will tend to be stable; the total market volume will continue to grow steadily, and outdoor products will go out of the trough; new markets will gradually form.

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