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China LED lighting market to grow 36% this year

Posted: 16 Jul 2013 ?? ?Print Version ?Bookmark and Share

Keywords:LED? general lighting? manufacturing?

According to the latest report from LEDinside, a research arm of TrendForce, China LED lighting market will post 36 per cent annual growth rate this year. Residential lighting market is the major growth momentum with a growth of 96 per cent in 2013 as it becomes the second largest general lighting applications market only second to commercial lighting, noted the market analytics company.

Traditional lighting manufacturers such as NVC, Opple, PAK and Foshan Lighting have expanded to LED lighting, while LED package plants such as Everlight, Edison, MLS and Changfang Lighting have taken full use of LED manufacturing advantages to seize Chinese lighting market.

LEDinside stated that benefiting from the intensive investment in lighting channel of various manufacturers, the quick falling in the sales price of LED lighting products and the improvement of average consumer's acceptance. In 2013, Chinese lighting market has achieved growths in commercial, residential, industrial and outdoor lighting fields with 24 per cent, 96 per cent, 28 per cent and 46 per cent, respectively, and formally entered the general public channel era. The competition for LED lighting market between traditional lighting manufacturers and LED lighting manufacturers has intensified, LEDinside said that whether the LED lighting manufacturers can dominate the market in the future or not depends on their channels establishment capability.

In view of the revenues of Chinese lighting manufacturers in 2012, NVC, Opple, PAK, Foshan Lighting and other traditional manufacturers have began introducing LED lighting products, but the LED lighting penetration rate still takes up low proportion of their overall revenues, in order to avoid direct impact on traditional businesses, the introduction of LED lighting product line and distribution establishment are relatively conservative.

However, MLS Lighting, Changfang Lighting and other LED lighting manufacturers entered the lighting market channel with the image of "LED price killer" through taking full use of the cost advantage of LED package devices, which not only have price advantage comparing with the traditional brand's LED products, in order to reduce the inventory risk for distributors, it also issued attractive distribution establishment policies, such as offering the falling price strategies within three months. Chinese lighting channels controlled by the four major brands has been gradually loosened, and many distributors switched to emerging LED lighting brands under the stimulation of the tremendous business opportunities of LED lighting.

Taiwan-based manufacturers that include Everlight, Edison and Unity Opto have actively conducted LED lighting market development, Everlight formally establishes distribution system in China in 2013 and conducts the channel establishment through the distributors, while Edison cooperates with traditional lighting manufacturers to grab Chinese LED lighting market. Unity Opto and Honyar jointly introduced Honya-Unity Opto lighting products.

LEDinside stated that how to quickly sell out products to gain the market share has become a top priority for manufacturers. In the early stage, LED lighting manufacturers mainly focused on engineering project and export-oriented sales channels, while the revenue models such as distributors, agents, exclusive stores and other channel modes have not really formed. According to statistics, the revenue achieved by Chinese LED lighting manufacturers through adopting channel modes in 2012 accounted for less than 30 per cent. With the increasing popularity of LED lighting products, manufacturers no longer depend on the sales channels like engineering projects and exports, in the future, LED lighting will be the same as the traditional lighting, the manufacturer who has superior sales channels will dominate the market.

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