HK International Airport Luggage Claim area goes LED

From What I saw the HKIA luggage claim area,  the ceiling lighting now all LED.

There are 13 luggage lane 21 and each lane has about 21 x4 tubes.

Each tube may contain 200 LED with 0.15 watts so the power rating of one tubes is 30Wattes.

21 groups x30 Watt X4 sets X13 luggage lanes equal to 32,760Watts

For those 1,092 tubes

32,760 watts x18 hours x 356 days = 209 Mwatts

1 watts is 1.1 HKD.  That is an equivalent of HKD$230,918.00 for electric fee a year.

If that is CCFL of 60Watts, that will be $430.918.00

The cost of the LED Tubes is about HKD$350, x 1092= $382,200

So it does need only two years to recover the cost of the LED tubes installation.

Do not forget the life time of the LED lighting is 40,000 hours. That saves a lot of cost for the replacement. If using CCFL tubes, its will have to replace the tubes almost every one here and there… as the life time of the CCFL tube is 12,000 hours only.

So in short, this is a good investment for using LED in Airport, and this save a lot of electricity, replacement cost, and tons of CO2 emission a year.

The above figure is purely my estimation as I can not go into detail to see the construction of the LED tubes a it was hanging 20 metres high!

HKIA Snob

LED Market Trend 2010- 2014

Overheat 2010 Market

After the crazy pursuit of LED build in 2010 and oversupply in 2011 that suppressed 2012 fabrication, LED makers would have seen a more or less leveling out of supply and demand. Demand is seeing drifting from LCD-backlit LEDs to LED for lighting.

2011 2012 Oversupply

In 2011, due to a combination of slower sales growth in LED-backlit LCD TV and slower growth in chips-per-backlight, much improved LED lighting efficiency and light guide efficiency. The demand for LEDs in LCD backlights did grow merely slightly, as tablet PCs goes larger and stronger penetration growth in LCD monitors*1 made up for the slash in demand from LED TV. Growth was also modest in lighting segment, as the market penetration of LEDs only grew from 1.4% in 2010 to 1.9% in 2011.

New Players

Many new LED suppliers have entered this market with rapid ramping up production. Chip size of 500um² supply grew by 41% in 2011, compared to only 10% growth in demand. This resulted in another significant oversupply. At Same time the LED Chip MOCVD installations were either on halt or delayed.

Further ASP Drops in 2012

LEDs have been in surplus since the Oct of 2010, setting the stage for a decrease in LED prices and profit margin drastically. As a result, there has been almost no new investment in LED applications, nor any significant capacity increases in 2012. This is resulting in a 50% drop of the supply/demand glut from 2011 to 2012.

LED 2013

We speculate that Demand from LCD backlights will continue to dominate LED demand until end 2012, when it will reach its peak. Due to the growing popularity of advance, low-cost direct-LED backlight designs for LCD TVs, the demand for LEDs in backlights will continue to increase through 2013. While the number of LED packages per LCD backlight unit will be at peak in 2012, continuing to growth in penetration of LED backlights will lead to a small insignificant growth in 2013.

LED 2014

By 2014, lighting by LED will become the major demand for LEDs as price reductions will be really attractive to most of the end users and at the same time efficacy improvements drive for an increased adoption.

The penetration of LEDs in lighting will reach 17% in 2015, according to LED Market Forecast Report.

Lighting LED situation Highlight

Spotlights and LED street lights will gain higher penetration in lighting segment due to government incentive programs which acted as the major LED driver as in China 2009. The 12th Five-Year Plan in China and the LED subsidy policy in Taiwan, as well as continued growth in commercial applications. LED bulbs and fluorescent tubes are growing in Japan due to government incentive programs and energy-saving consciousness, especially following the March 2011 earthquake.

Pricing strategy

Philips recently made an aggressive offer of less 50% for the new 10W LED light bulb for a low price as $25, and that is a big impact for the market, and I believe other major key players will observe and adjust the price at the same time.

Sapphire Substrate Supply

Rubicon’s major income on 2H 11 was coming from 6” Sapphire substrates, due to the inventory of LED substrates is high. The 1H 12 Sales will not be promising for 6” Substrates. However we could see tat SoS (silicon on sapphire) market grows 2 times from 1Q12 as comparing with Q4 11. We will see that 2H 12 Would enjoy certain growth on this 6” SoS substrates.

Rubicon will try to maintain competitive price, and they might reduce cost 20% in 2013 to maintain the profit level.

China RMB26.5bn Home appliance Subsidies

China announces new home appliance subsidies; potential for LCD TV market to expand; China's State Council announced a RMB26.5bn subsidy program for household electrical appliances on 17 May.

The program will be in effect for one year, and target air conditioners, flat-panel television sets, refrigerators, washing machines and water heaters. The program also earmarks RMB2.2bn for LED and other energy-saving light bulbs and LEDs.’

LED Equipment demand

If we assume the government is planning on subsidizing ~50% of LED bulb cost, assuming an average pre-subsidy price per LED bulb of ~$7, and assuming China accounts for ~20% of the worldwide bulb market, this subsidy would translate to ~104M bulbs or ~5% of China's bulb demand.

Summary

Like what we had mentioned that in the previous report, the Q4 2012 will be the turning point for the LED to move up from valley into a more or less higher growth rate after 2 years of quietness. Main driver is LED lighting. Many of the LEDMaker equipment utilization is still running at 60-75% range, with the new lighting bulb demand and China Incentive to support LED. We will see some bigger demand of LED manufacturing equipment by Oct. 2012. LED market will keep on growing 2013-2014

HK Snob

Philips 10-Watt LED light bulb finally has a cost breakthrough to impact the World Lighting Market

Dutch electronics giant Philips scheduled the release of their new 10 Watt LED light bulb, were to replace each and every 60-watt incandescent bulb. Philips indicates will last for approximate 20-years (from Philips’ 30,000 Hours life time, and 4 hours a day operation) to coincide with Earth Day.

The 10-watt LED (light-emitting diode) bulb had won the U.S. Department of Energy’s “Bright Tomorrow Lighting Prize”!

According to Philips’ North America executive Ed Crawford, the LED emits 940 Lumens, and it is 83% percent more energy efficient than the standard 60-watt incandescent.

Currently, the 20 year bulbs are priced at $50, however, Philips said that it was in the process of planning discounts which would potentially bring the cost down to as little as $25.

Philips LED light bulbs contains LumiLEDs Rebel LEDs which has a Flip Chip process build on a 3mm x 3mm ceramic substrate, An unique LED assembly built in Penang Lumileds Factory.

Price would be the key concern for public acceptance, Philips offer a price of US$25 would be a significant drive for the majority people to consider an early switch from Incandescent lamp or AFL to LED.

This has an significant effect

1. Philips should have an estimation on the world demand of this LED bulb and what if the demand is huge, can their Lumileds LED modules supply be enough to meet the need?
2. What is the response of other major LED bulb makers Osram, Sharp, Toshiba,  Cree? Will they reduce the price and go into direct competition with Philips?

Or they will stay calm and watch out for a while to see the public response first.

3.  Though Philips LED bulb is one of the best in terms of Thermal performance, Reliability and Chip efficacy, will the Top Taiwanese, Korean, and China LED bulb makers come up with a more severe price reduction to maintain the market share?
4. Will there be another heat of LED demand after LED market quiet for 2 years and a half since Oct 2009?

I think there will be some impact on LED if Philips lower down price of LED bulb significantly, actually I wonder if they have enough capacity to meet the demand.

Price is King and I Hope this will create the interests of most of the people to take an earlier move to change the low efficient incandescent lamp into LED.

Enjoy a green World of Lighting. And start saving energy to save the World by Today for Tomorrow..

HK Snob

LED for making your skin younger

Research conducted in the 70’s aboard NASA Space flihts revealed that human cell metabolism is revitalized by Visible light. Similar to the photosynthesis process in plant cells, human cells also require exposure to light to stimulate the production of collagen and elastin, the building block for human skin.

Talika Light Duo 590/525 is an innovative packaging especially designed by Talika, which combines the light590® and the light525® actions to offer a global anti aging treatment. One side emits the light 590 (590 nm light wave) for anti-wrinkle; another side emits the light 525 (525 nm light wave) for brightening skin.

Talika Light Duo, Anti-Aging & Skin Brightening 2in1
The package include one Light Duo, USB Cable, Universal Voltage Adaptor with round and flat plug, self cleaning protective pouch, manual.

Light 590® emits only thevery best of the light, guaranteeing truly remarkable anti-ageing results. Light 590® is effective from the very first month on 100% of volunteers in the Pitié-Salpêtrière Hospital in Paris, France.

After the success of Light 590®, TALIKA laboratories is proud to present its new revolution in skincare treatment. They are selling on board Philippine Airlines at USD$353.00

But they are consisting of finely graded LED lamps with the same wave length.

Consequences of aging are visible through Ages spots and skin is less radiant. Talika Light 525® acts directly on these two aspects: Light 525® helps to eliminate the appearance of age spots. With less apparent age spots, skin is visibly more radiant and looks younger.

Light 525® Skin Lightener only emits the best of the light, guaranteeing truly remarkable brightening results.

Features

Innovative Light Technology in Cosmetics from France
Anti-Wrinkle through Light
Anti-Dark Spot through Light
Dermatology tested
One year warranty
Use Directions

HK Snob

2012 HBLED and LED Lighting Market

2012 Overall World Wide HBLED revenue is estimated to be US$10.B, with net growth of 13% comparing with 2011.
Due to softened demand, th installation for LED MOCVD will be reduced to 200 sets only in 2012. The 1H 12 LED business atmosphere is relative much weaker comparing with the 1H 10.
If there is MOCVD installation will be in Q2 or even end Q3.
Japan, Korea and Taiwan takes up 60% of the overall HBLED market, this indicates the major business base is in Asia. China will continue to grow with 30%. Installation of those Q1 11 ordered LED MOCVD will be postponed to 2H 12.
Those China LED are majority low to mid Power only, very small percentage of them are HBLED.
2012 HBLED distribution will be approximately 34% for Large TopLED for BLU, 18% for Lighting. We estimated that the percentage for large size TopLED for BLU and Lighting wilt be about 30% and 33% respectively in 2013.
Lighting LED
Light Intensity equivalent to 60W incandescent light bulb with 810lm are selling at USD$40 each, however the sweet spot price of such LED is different in terms of location, such as US$25 in Japan, US$14 for Europe and US$7 for other new developing countries. CFL light bulb is still the major choice in 2012, LED lighting penetration rate is about 5.4%, comparing with 3.3% in 2011 and 0.3 % in 2010. There will have about 1B LED light bulbs leaving the factory entering your household area in 2012.
Overall speaking, developed countries are pushing for higher LED lighting penetration, Japan is the leader in promoting LED lighting. In this islands, by 2015, they will have 50% LED lighting. US DOE is planning to push up LED efficacy to 200lm/W by Technology in 2014 with target price of US$2 per 1Klm.
We estimated that World Wide Lighting LED penetration rate will achieve 11% in 2012, and will rise up to 26% in 2014, with revenue of US$17B go up to $42B in 2014.
HK Snob

Market Situation of LED 2012-2013

Market Situation
The U.S. Japan and EU has taken the lead in proving the viability
Of LED technology for outdoor lighting. With major players Osram, Cree, Nichia, Lumileds, Seoul Semi, Everlight, Soraa… etc.
Despite more installations, China has become the first casualty of quality issues which has resulted in the decrease of the Chinese market for outdoor lighting in 2011.
In North America, quality consciousness along with the efforts of DOE and other key organizations has propelled the transitioning to LEDs.
The 20% -25% drop in price of LED packages has proved to be a boon for quality luminaire manufacturers.
Average price of outdoor luminaries has continued to decline in 2011 and this trend is likely to accelerate in 2012.
This decline in price will help post-pilot and post-stimulus programs.
While the CAGR for unit growth is forecast to grow 26% from 2010 to 2015, the CAGR for revenues will be only 11% as downward pressure on price Continues.
Considering that LEDs compete against other efficient technologies, the viability of LED
applications in outdoor applications will be a test for LED technology.
LED MOCVD Installation Korea and Taiwan dominated in number of MOCVD installation in 2009. China came up as leading installation region and became major site for installation since Q4’10. China is expected to continue to be the dominant MOCVD market until Q3’ 12 But China will shrink from three third down to 60% in Q4’12 when Taiwan and Korea rebounds. Largest MOCVD Installation Base Epistar is expected to be #1 MOCVD customer in 2012, followed by San’an, GCL Opto, SemiLEDs and Genesis Photonics onpur. Such Rapid expansion in 2010-2011lead to an overcapacity that we think it will be fully utilized only by mid 2012.
LED lighting Status Total LED lighting demand in Q2 & Q3 2011 keeps increasing. The Demand is 3.2 billion units for Q2’11. And the demand is predicted to be 3.4 billion units for Q3’11. The Growth is not seen as significant as we expected beginning of the year. Whereas Q1 2012 would be cary on increasing on demand on LED on lighting sector.
LED lighting Players Due to Government encouragement for going greener energy, limited resources of these islands, as well the March 11 Quake issue that rocked the Nuclear Power plant, alerted Japanese Citizen and Government on using more efficient Source of Light. Japan, as biggest market for LED bulbs in 2011, with market share of 63 %, Japan will remain the biggest lighting market until 2014. Price of LED replacement Bulb keeps on dropping. The downtrend of LED caused the LED light bulb price to drop from USD83 /Klm in 2010 to USD 52 / Klm at this stage. However, the initial cost of the LED light bulbs is still much higher than that of general light bulbs, so it is still too soon to say whether LED light can fully replace the latter. ASP of Japan LED light bulb was Yen 3000 for 5W in Q1 2010, and dropped to Yen 2,000 in Q1 2011, the speed of ASP drops slow down. That indicates that the adoption is slow down in Q2 2011. LED bulb growth in China, North America and Europe will be higher than other areas from 2011 to 2014 China - biggest market for LED street lights in 2011, but due to China government policies. With market share of 55 %, but China will slightly decline to 50 % in 2013.
Economic Situation
2012 brings yet another year to all of us, and once again the industry is bouncing back after a challenging 2011. We welcome a fresh optimistic outlook as perceived by semiconductor industry analysts at large, both domestically and abroad. The sovereign debt and economic worries of the European Union has brought a torrent of dreadful news, yet the industrial indicators within technology and specifically the semiconductor segment reflect increasing stability. LED side would also be affected as simply once rich country was down to a level that people will scary for the investment for future. Energy Saving program is a long term energy harvest program, this will be only be high lighted when the country is economical stable, where as in such World Wide economy instability period. National policy working on LED energy will not be the top of the Do-list on the presidency desk anymore even China.
Package LED market Forecast In 2010-2011, rapid expansion of MOCVD in China Initiated in Korea and Taiwan since 2009. Cause capacity utilization rate of <50% for certain tools by mid 2012. It will take 12-18 months to absorb this overcapacity, and that causes a short down cycle The down cycle will extend through mid 2013! Some consolidations will bring the industry back to more usual utilization rates of at least 80%, before any capex initiation for next new investment including Manufacturing Equipment such as MOCVD, Die Sorter, Die bonder, wire bonder, tester, package sorter and Taping Machines.
Equipment Forecast for LED lighting If adoption of LED for SSL happens faster than initially envisioned, it would lead to higher equipment investment levels. Excess capacity installed in 2010-2011 is absorbed much more quickly than expected. The Equipment market will bounce back significantly in Q1 2013 to respond to accelerated demand for general lighting.
Why LED is not moving into our house?
What are reason LED market will not fly out as we forecast
1, Cost of the LED bulb is still high, not until that price is 2X-3X or less of CFL, there will be not having huge demand on the light LED
2. Pychronogical effect
In lighting LED users are mainly people who really care about energy harvest , global warming and from Middle class people. The rich will never care about how much they can save the electrically, they will continue to use CFL or even incandescent lamp.
The Poor has to fill up their stomach instead of going for LED, forget it!
Only Middle class people, educated and people caring about the Motherhood of Earth will go for LED.
Imagine in your company, how many managers are using 100% LED as lighting in his house, less than 1 or 2 persons
Government promotion and support, HK is slow in these respects and HK in fact is the last country employing LED in Traffic light, after China, Japan, Singapore, Malaysia, Thailand… This is a disgrace as a HK Government in protecting the Earth.
China Investment
Wen jiaBao had announced that the scale of incentive financial support to the industry and infrastucture expansion will not be as strong as he did in Q1 2009. That is another way to control the fly up of inflation, so Energy saving sector will not enjoy much as they did in 2009. This is another cause of the LED market to grow as in 2010.
Difficult year for small LED Assembly company
Look at the Equipment idle rate of the big shot Player, if their utilization rate is less than 80%, there will be less drive for next equipment purchase trigger, and they will convert back the subcon business to fill up the idle equipment, Smaller LED company will face will difficulty due to less bargaining power higher material cost and the impact of higher China Labour cost. I believe there will be at least 15% of the Small – medium China LED company will down size in their scale in production and start to control the cost, or go for merging in order to struggle for Survival, especial those “me-too” product company.
When next LED Market growth
1.Not until average LED manufacturing equipment utilization reach an average of 80% or more.
World Economic stability is an factor for people to invest on energy saving device like LED
2. Inflation to be GOING down.
3. Government Promotion on the use of better environment friendly LED
4. Government banning sales on 40W of below Incandescent lamps.
Better Efficacy and higher technology breakthrough to deliver low cost LED as commercial availability.
5. LED is really attain a price of no more than 3X of CFL lamp with equal
Lighting intensity.
6. LED bulb is really can last for 40,000 hours?
Personally, I am not optimistic for LED lighting will have a huge demand in 2012 as we forecasted in 2010. Optimistically, we are looking at 2013 Q1. provided the world economic is keen and sound, with all the sovereign debt and economic worries of the European Union have been removed.
HK Snob

Top Ten LED Companies in the World

The Oscar LED award is Shenzhen 2011 Annual LED seminar on 9-10 Dec. after 2 months of score evaluation by Internet voting on the best LED National Companies go to: ASMPT, Philips Lumileds, OSRAM opto semiconductors, CREE, Nichia, Seoul Semiconductor, Epistar, EVERLIGHT, Intematix and OPTILED.

1st Best Company
ASM Pacific Technology was established in 1975, headquarters in Holland, world Largest semiconductor and LED assembly equipment supplier. ASM went public in HK on 1989, with an set-up of the major manufacturing site in Sha Tau Jiao China Which have a leverage of abundant supply of skillful workers, close to HK border. Evaluation Body rates ASMPT as the most monopolized brand with installation covers most of the area in China, Highest market share, though has been replaced by China brand in certain low end product. ASMPT would continue to be most important LED position in the coming years.


2nd Best Company
Philips Lumileds is World leading Hi Power LED manufacturer and leader in Hi Power LED. A pioneer in the interior and exterior illumination LED. Solid state lighting supplier with the launch of patented LUXEON, which has advantage to have life time of 50,000 hours.

Lumileds had the world most brightest and longest life time. Evaluation team rates Lumileds a company that has Quality of the highest standard. 

No wonder your Audi R8, A6 head lamp are built by Lumileds, using ASM Highly sophisticated eutectic bonder custom made for them back in 2007.

3rd Best Company
Osram Opto Semiconductor, is under Siemens Germany for manufacturing LED.; They have 5,000 products, one of the World Largest Supplier company in the World, Osram is having a very critical position in the Illumination market. 

There are 140 counties is having Sales and distribution office. Evaluation body rates Osram a low profile German Company. German is usually responsibility in handling the quality issues, never Say yes to inferior Products.

4th Best Company
Cree covers their Business from LED wafer, or sorted wafer for consistent quality. A World Leader in SiC Carbide  Chip and LED final Assembly, Headquarters is Durham NC USA, factory location in Hui Zhou, and R & D Centre will be in Hui Zhou, Penang, ShenZhen and HK China, near the customers.

LED Factory at Hui Zhou is world Largest of Cree, it takes up 40% or more on the assembly . Cree can make use of it building up other Companies and Sells the Chip locally to China.


5th Best Company
Nichia was located in in Fukushima, Japan, it started selling Florescent material for CRT Tubes OF TV set. It shows announced that they have invented the Blue LED in 1993 then Ultraviolet LED, Yellow Phosphor. Nakamura San who would get a nobel prize.

The Evaluation team rates Nichia the most Killing Brand in White LED, 2011 total number of LED is world No.1. Their LED has the good quality and customer reputation, and their Patent will help to create high revenue for Nichai over these years.

6th Best Company
Seoul semiconductor is world renowned brand for LED, established in Seoul in 1987. HQs is in Seoul, main product line is Acriche, AC LED; HB LED , Side LED, Piranha, They started a China New factory in Tianjian  for China and SEA market.

Evaluation team describes Seoul Semiconductor as fast solution and reaction into their competitive market.

7th Best Company
Epistar, established in 1995 Taiwan, soon became Taiwan NO. 1 largest LED wafer maker. Epistar fully devotes themselves in LED wafer manufacturing, They have their own MOCVDs.

Evaluation team rates Epistar the toughest complaints international big shots on LED Wafer manufacturers., We could find numerous people are using Epistar LED on their lines in their future is bright and could not be underestimated.

8th Best Company
Everlight, established in Taipei Tu Cheng in 1983., I was the engineer came to Tu Cheng to install the the first two LED die bonders in 1988.

Robert Yeh is the Heisman to bring up this once a very small company, gradually over the years working with the most prominent LED suppliers to build their strength in both technology, high scale of manufacturability developed their factory in China Started in PanYu, Fa Shan, Yuen Li (Taiwan), Lian Su Zhou, GuangZou Today like the Taiwan Largest LED assembly company.

Recently Robert Yeh Expanded his business to include the wafer fab. So that they are horizontal integration to gain the control of not just price, but also supply volume on LED Wafer.

Evaluation Team rates Everlight Most Powerful Brand of World No. 1 LED Assembly Company They have their own brand name, own product like Dolphin, BLU.

9th Best Company
Intematix holds more then 250 patents, come with new, innovations on Yellow Phosphor powder, leading the world in technology of Phosphor application. With HQs in California with factory in Shenzhen SO Zhou lighting company, Intematix Taiwan.

Report released by China LED researcher GLII 2011’ Yellow Phosphor Competiveness rated as No. 1.
Evaluation team rates Inetmatix the fastest moving up company for Phosphor Powder manufacturing and occupying No. 1 in China for Yellow Phosphor Market.

10th Best Company
Found in US in 2000, HQs is in Hong Kong, a solution provider for international clients on Lighting solution, Support end user to make smallest investment with Maximum Return.
Evaluation team rates OPTILED the most innovative brand, focus on LED application with the latest technology. Covering all countries in the World.

Feverip

October Worldwide LED TV Shipments Exceeded 10 Million

According to Displaybank “Monthly FPD TV Shipments Data” report, LED TV shipments in October 2011 increased by 3% M-o-M and 98% Y-o-Y, recording 10.1M units. The Worldwide LED TV shipments in October 2011 exceeded 10M units for the first time.
As LED BLU is adopted to premium products such as 3D and Smart TV by default, shipments proportion of LED TV is increasing continuously. Also, LED TV demand is steadily increasing as the price difference between LED and CCFL BLU gets narrowed. LED BLU adoption rate of LCD TV has increased from 32% in the beginning of the year to 48% in October.
Overall LCD TV shipments has stopped at the 15M units per month level since March but increased sharply in September, and recording 20.9M units in October as it continues increased level. This can be due to demand in preparation of Chinese National Day and increasing demand for Black Friday and year-end sales of North America. We estimated 2011 total LCD TV shipments to be 203M units.
If you take a look at October LCD TV shipments share by brand, Samsung is maintaining No. 1 position with 22% and LG Electronics is ranked at the 2nd with 13%, followed by Sony and Toshiba, recording 9% and 8%, respectively.
October worldwide flat TV (LCD, PDP) shipments increased by 11% Y-o-Y, recording the maximum value so far this year with 22.67M units.
These are the top 14 TV makers
China:Chang Hong, Haier, Hisense, Konka, Skyworth, TCL
Korea: LG, g
Europe: Philips
Japan: Panasonic, Sharp, Sony, Toshiba
USA: Vizio
HK Snob

Next LED Manufacturing Equipment Demand

Low demand for consumer electronics LEDs, such as those Backlit units for LCD TVs, will be weak until at least till Q1 2012. It was clear that demand for nonlighting
LED applications continues to be tepid. Veeco indicated the utilization rates
for its MOCVD equipment in Korea and Taiwan was 60%, Rubicon indicated it will probably take until the end of the year to draw down excess levels of sapphire and LED wafers. This weakness for consumer electronics grade LEDs does have an impact on all LED pricing, even for higher performance lighting grade products.
The continued oversupply of LEDs in general will help to accelerate LED lighting adoption due to the suppressed LED pricing outlook.
We think the best place to invest will be as far downstream as possible in the LED-based lighting food chain. This is where we expect to see the highest revenue growth rates and most shelter from weakness in the broader LED sector should the macro outlook remain weak. We also believe a general rise in utility-based subsidies for LED-based lighting will occur over the next 18 months helping to accelerate adoption.
LED-based lighting demand growth remains strong in Spite of the weak macro
environment. The current equipment demand slow down is purely due to over-capacity in the past two years. Let’s wait for another 9-12 months, it will come into a higher level of production utilization and that would be time for next equipment Purchase.
HK Snob

When LED Market Will Grow again?

LED MOCVD Installation
Korea and Taiwan dominated in number of MOCVD installation in 2009.
China came up as leading installation region and became major site for installation since Q4’10. China is expected to continue to be the dominant MOCVD market until Q3’ 12
But China will shrink from three third down to 60% in Q4’12 when Taiwan and Korea rebounds.
Largest MOCVD Installation Base
Epistar is expected to be #1 MOCVD customer in 2012, followed by San’an, GCL Opto, SemiLEDs and Genesis Photonics onpur.
Such Rapid expansion in 2010-2011lead to an overcapacity that we think it will be fully utilized only by mid 2012.
LED lighting Status
Total LED lighting demand in Q2 & Q3 2011keeps increasing. The Demand
is 3.2 billion units for Q2’11. And the demand is predicted to be 3.4 billion units for Q3’11. The Growth is not seen as significant as we expected beginning of the year.
LED lighting Players
Due to Government encouragement for going greener energy, limited resources of these islands, as well the March 11 Quake issue that rocked the Nuclear Power plant, alerted Japanese Citizen and Government on using more efficient Source of Light. Japan, as biggest market for LED bulbs in 2011, with market share of 63 %, Japan will remain the biggest lighting market until 2014. Price of LED replacement Bulb keeps on dropping.
The downtrend of LED caused the LED light bulb price to drop from USD83 /Klm in 2010 to USD 52 / Klm at this stage. However, the initial cost of the LED light bulbs is still much higher than that of general light bulbs, so it is still too soon to say whether LED light can fully replace the latter. ASP of Japan LED light bulb was Yen 3000 for 5W in Q1 2010, and dropped to Yen 2,000 in Q1 2011, the speed of ASP drops slow down. That indicates that the adoption is slow down in Q2 2011.
LED bulb growth in China, North America and Europe will be higher than other areas from 2011 to 2014
China - biggest market for LED street lights in 2011, but due to China government policies. With market share of 55 %, but China will slightly decline to 50 % in 2013.
Economic Situation
We are now experiencing dual Core Economy (USA and Europe) slow down though the scale and intensity was not as worse of September 2008. We will not having the same good old day as the maket would bounce back as early as 2009 Q2 3 after Leman Brothers melt down 15 Sep 2008. Government Policy will not focus on Green Energy harvest rater than on job creation, economic reform, and stimulus plan for economy. Less incentive programmes for LED lighting penetration will be generated.
LED lighting Type
Highest penetration in spot lights Due to halogen replacements
Government policies are expected to accelerate LED penetration in street lights after 2011.
Package LED market Forecast
In 2010-2011, rapid expansion of MOCVD in China
Initiated in Korea and Taiwan since 2009.
Cause capacity utilization rate of <50% for certain tools by mid 2012.
It will take 12-18 months to absorb this overcapacity, and that causes a short down cycle
The down cycle will extend through mid 2013!
Some consolidations will bring the industry back to more usual utilization rates of at least 80%, before any capex initiation for next new investment including Manufacturing Equipment such as MOCVD, Die Sorter, Die bonder, wire bonder, tester, package sorter and Taping Machines.
Equipment Forecast for LED lighting
If adoption of LED for SSL happens faster than initially envisioned, it would lead to higher equipment investment levels. Excess capacity installed in 2010-2011 is absorbed much more quickly than expected. The Equipment market will bounce back significantly in Q1 2013 to respond to accelerated demand for general lighting applications.
HK Snob