The next five years will be the golden growth period of the LED industry

LED is known as the fourth generation lighting source or green light source and is a semiconductor solid-state light emitting device. In 1955, Rubin Braunstein of the American Radio Corporation discovered the infrared radiation effect of gallium arsenide (GaAs) and other semiconductor alloys. In 1962, Nick Holonyak Jr of General Electric Company (GE) developed a visible light LED. However, the real take-off of LEDs was only gradually taken into account after the appearance of white LEDs in the 1990s.

In recent years, LED has faced explosive growth, which is mainly due to the support of various countries' policies, the rapid increase in demand for downstream TV backlights, and the replacement of large-scale general lighting brought about by the decline in future costs. It can be said that in the next five years, it will be the golden growth period of the LED industry.

The world's top five LED manufacturers

In the face of global climate change and rising energy prices, governments in various countries have already begun to list some high-energy-consuming products as the primary targets of banned use. For example, incandescent light bulbs are the most obvious case. The ban on incandescent light bulbs began with the European Union and Japan first, and subsequent national governments followed suit. From the timetable for disabling incandescent light bulbs in various countries to observe, after 2012, most countries began to gradually disable incandescent light bulbs, which also brought huge business opportunities for LED lighting.

There are relatively few companies that have the full power to engage in the full business of the LED industry chain, mainly the leading companies in the United States, Japan, and South Korea. Currently, the top five LED manufacturers with large scale in foreign countries are Cree of the United States, Osram of Germany, Philips of the Netherlands, Nichia of Japan, and Seoul Semiconductor of Korea (Seoul Semiconductor ).

LED upstream is monopolized by foreign manufacturers

The LED industry has formed a complete industrial chain in the world. There are a large number of companies in the United States, Japan, Europe, China Taiwan, South Korea and other countries and regions, mainly in the substrate, epitaxial wafers, chips and packaging.

The core technology of LED is the epitaxial growth of high-brightness LED and chip manufacturing technology. With high technical content and added value, it is a typical technology-intensive and capital-intensive industry. This field has always been an industry high ground where companies in the industry have competed to climb. At present, the United States, Japan and other countries have technological advantages in the design of raw materials and devices for core devices, and are at the leading level in the world. Japan’s Nichia Chemical and Toyota Synthetic, USA’s Cree, and Germany’s Osram are temporarily in the global semiconductor lighting patent market. Technical monopoly position. In terms of sales and market share, these large companies are also in an absolute leading position.

For the production of LED chips, the selection of the substrate material at the front end of the industrial chain is the first issue to be considered, and the selection must be made according to the requirements of the device and the LED device. At present, chip manufacturers that use SiC as a substrate in the world mainly include: Cree Corporation of the United States, SiCrystal and Norstel Corporation of Europe, Tianke Heda Blu-ray Semiconductor Co., Ltd. and NionSteel Corporation of Asia, among which Cree Corporation SiC chips Technology, production and sales are all in the leading position in the world, accounting for about 80% of the market share. However, high prices will still hinder the wide application of SiC chips.

In addition to substrates, epitaxial wafers also belong to the upstream end of the LED industry. At present, the LED epitaxial wafer production technology mainly uses MOCVD, and there are only 3 to 5 companies that can produce this equipment worldwide. The world's two largest MOCVD producers are AIXTRON of Germany and VEECO of the United States. They occupy more than 90% of the global MOCVD supply market and are in a monopoly position.

According to the market research report of the VLSI Research Institute in April 2008 and GartnerDataquest Research Institute in May 2009, AIXTRON's global market share in 2008 was approximately 72%, and VEECO's global market share was approximately 19%.

In the past year, the sudden surge in demand for MOCVD equipment also gave VEECO the opportunity to grab orders from AIXTRON. According to information released by Gartner Research Institute in March 2010, AIXTRON's MOCVD product market share was 68%.

Japan's LED packaging plant has the highest market share

According to the LEDinside statistics of the research institute, the total revenue of global LED packaging factories in 2009 reached 8.05 billion U.S. dollars, an increase of 5% over 2008. In terms of regions, Japanese manufacturers have the highest market share, but show a declining trend year by year; Chinese Taiwanese manufacturers have a market share of 17%, ranking second, showing an upward trend year after year; Korean manufacturers’ market share from 2008. 9% soared to 15% in 2009, ranking third in the world. In recent years, with the rapid expansion of packaging companies and their production capacity in mainland China, the global market share of the packaging industry in China has been steadily rising, with a market share of 11% in 2009.

Looking at the operating income of individual manufacturers, the LED suppliers that entered the large-size backlight market earlier have seen their operating income rise against the trend in the financial crisis. For example, companies such as Korea’s Samsung LED, Seoul Semiconductor, and Japan’s Toyota Synthesizes. In terms of operating income, Japan's Nichia Chemical ranked first in the world in 2009, followed by Germany's Osram and the United States, such as traditional LED companies such as Cree, China's Taiwan and Lite-On Light also entered the top ten. The top ten packaging companies had a total operating revenue of 5.2 billion U.S. dollars in 2009, and the rest of the company's operating income in 2009 totaled 2.85 billion U.S. dollars.

In addition, the current patented technology is an important means for major global LED manufacturers to gain competitive advantage and maintain their market share. Since 2000, the lawsuits and reconciliations of patent rights of Nichia, Philips, Cree, and OSRAM have been occurring. In a sense, several major LED manufacturers have dominated the development trend of the LED industry. LED manufacturers conduct R&D and production through authorization and cross-licensing, forming alliances between companies, thereby increasing industry barriers to entry.