Review of the "Top Ten Events" in the LED Industry in 2013

Review of the “Top Ten Events in the LED Industry in 2013:

1. Fiscal Subsidy

In February 2012, the "2012 Semiconductor Lighting Product Financial Subsidy Promotion Project" was launched for domestic public bidding. Then in July, due to major changes in national policies and other reasons, the procurement targets set in the original bidding document could no longer meet the new demand, so the bidding project was renamed "2012/2013." "Financial Subsidy Promotion Project for Semiconductor Lighting Products" and organized a separate bidding. A total of 39 companies won the bid, and the total number of winning LED lighting products reached 8.73 million. This is also the first time that the country has subsidized the promotion of LED products, which directly boosted the demand for LED lighting by about 2-3 billion yuan.

2. Semiconductor Lighting Twelfth Five-Year Special Plan

On July 11, the Ministry of Science and Technology issued the "Notice on Issuing the "Twelfth Five-Year Plan" for the Development of Semiconductor Lighting Technology", formulating the overall goals for the development of the semiconductor lighting industry and emphasizing five key tasks. It is proposed that by 2015: the scale of the LED lighting industry will reach 500 billion yuan, and LED lighting products will account for 30% of general lighting; it will focus on cultivating 20-30 leading companies, and build 20 national-level industrial bases and 50 "Ten Cities, Ten Thousand Lights" pilot demonstration cities. This shows the government's expectations, attention and importance for the LED industry.

3. LED promotion

On May 28, 2012, the Guangdong Provincial Government held the "Guangdong Province Promotion and Application of LED Lighting Products Work Conference" and issued the "Guangdong Province Implementation Plan for Promoting the Use of LED Lighting Products", planning to popularize LED public lighting in Guangdong in three years, which promoted the popularization of LED lighting and promoted the prosperity and development of the LED lighting market. According to Dongguan Baokai Electronic Technology Co., Ltd., Guangdong Province currently has installed more than 800,000 LED street lights, more than 2.1 million indoor lights, and more than 20,000 kilometers of demonstration road sections. The overall energy saving is 55%, and the cumulative electricity saving is 1 billion kilowatt hours. The application scale ranks among the top in the country.

4. LED lighting standard optical components

In 2013, under the guidance of the Guangdong Provincial Department of Science and Technology, the National Semiconductor Lighting Engineering R&D and Industry Alliance, the Guangdong Semiconductor Lighting Industry Joint Innovation Center and Dongguan Baokai Electronic Technology Co., Ltd. The "LED Lighting Standard Optical Component Project" implemented by the organization has been fully launched, and framework coding rules and commonly used modules have been released. Some new module standards and patented technologies will be released regularly and irregularly for unified adoption by enterprises, guiding the LED lighting industry to develop in the direction of standardization, serialization, and standardization.

5. Counterattack of domestic equipment

In 2013, the localization of LED equipment took a solid step and realized the counterattack of diaosi. In March 2012, with the joint support of the Chinese Academy of Sciences and Guangdong Province, the first 48-wafer MOCVD prototype developed by the Institute of Semiconductors of the Chinese Academy of Sciences made significant progress. Zhongke Hongwei stated that the company's short-term goal is to use three years to carry out equipment development, test debugging and industrial verification, and achieve a mass production capacity of more than 100 units per year.

6. NVC Lighting Venture Capital Debate

The most uproarous incident in the industry in 2013 was the infighting at NVC Lighting. After NVC Lighting issued an announcement on May 25 that its chairman Wu Changjiang resigned from all positions due to personal reasons, on July 12, the meeting between NVC Lighting’s new board of directors and management, employees, and dealer representatives turned into a drama of forcing the board of directors. Subsequently, Weibo exchanges, the resignation of senior executives, the resignation of directors... The dispute over NVC Lighting's venture capital came to a climax, and finally ended with an announcement by NVC Lighting that Wu Changjiang was appointed as the head of the interim operating committee of NVC Lighting.

7. Sanan’s acquisition of Can Yuan Optoelectronics

In November 2013, Sanan Optoelectronics invested approximately US$80.3 million to subscribe for 19.9% of the equity of Can Yuan Optoelectronics Co., Ltd., Taiwan’s second largest LED chip factory, becoming its largest shareholder. It is understood that Sanan Optoelectronics has chosen Canyuan Optoelectronics as its cooperation partner this time, mainly based on the complementarity of the two parties' products and sales areas. It will greatly optimize the market layout of both parties, exert synergy effects, and jointly strive for business opportunities in the international and mainland markets. This is currently mainland China’s largest investment project in Taiwan, and it is also the first case of cross-strait investment cooperation in the LED industry. It is also the first case of mergers and acquisitions of listed companies on both sides of the strait.

8. Dehao Runda acquires NVC Lighting

On the evening of December 26, 2013, Dehao Runda spent a total of HK$1.654 billion to acquire 20.05% of the equity of NVC Lighting. Dehao Runda stated that it actively seeks in-depth cooperation with NVC Lighting in the promotion of LED lighting products, in order to use its complete sales channels and strong dealer network to sell the company's LED lighting products. The alliance between the two giants marks the gradual entry into a climax stage of mergers and acquisitions in the domestic LED industry.

9. Changfang Lighting recall

On July 31, 2013, Changfang Lighting had a nationwide recall of LED lighting fixtures, and 10,000 problematic bulbs were destroyed at the factory. This recall of LED lamps is the first of its kind in the country and has caused intense discussion in the industry. It is reported that in order to prevent accidents, Changfang Lighting resolutely prevents defective lamps from being sold on the market. The company lost more than 100,000 yuan in the Changfang Lighting recall incident, which is a strategic turning point for Changfang Lighting to attach importance to the brand. It also serves as a benchmark and wake-up call for the LED lighting industry to create quality products.

10. Mulinsen price adjustment

On June 15, 2013, Mulinsen Co., Ltd. made a substantial price adjustment on some LED bulbs and LEDT8 lamp tubes, with a price adjustment range of more than 40%. This was the second round of price adjustment measures implemented since the beginning of this year. The cumulative price adjustment range of the two times reached 70%, which shocked the industry. Mulinsen Co., Ltd. said that the company continues its cost-effective strategy and hopes to enable the general public to use LED energy-saving products at lower prices, bringing LED into the era of civilian consumption and setting off a revolution in affordable LED lights in the industry.

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Review of the "Top Ten Events" in the LED Industry in 2013

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