2017 LED industry opened the price increase tour display price increase trend enhanced

In the commercial economy, price changes are extremely common. The rise and fall of commodities is usually a few happy ones. The “price rise” presented to us in the economic activities in 2016 has aroused widespread concern. Affected by the great environmental impact of the reform of the supply side of the state, the state vigorously promoted the “three to one and one subsidy” policy of de-capacity, de-stocking, deleveraging, cost reduction, and short-term tasks, and related environmental protection, monetary policy, etc. Affected by factors, the price of raw materials on the supply side generally rose, and led to the rise in prices of hardware, fuel, chemicals, plastics and other industries. The LED display industry with high assembly characteristics has not been able to cover semiconductor, hardware, plastics and other fields. Avoiding a series of product price hikes, and due to the characteristics of the industry itself, the LED display industry is very sensitive to the market reaction. The price increase trend in 2016 has been scraped from the beginning of the year to the end of the year, and it is expected to be in 2017. Continue to stage the trend.

As far as the situation of the whole industry is concerned, prices have always touched the nerves of China's LED industry. Of course, the “price war” prevailing in previous years, the operators have the willingness to subjective choices, and the price reduction seems to be entirely determined by themselves, but in 2016 In addition to this situation, there is another situation. This is the concern of the industry. Throughout the LED industry, the price of raw materials has risen. We will probably look back: since March 2016, it was led by Jingdian and Sanan. Some LED chips have risen by about 10%, and then Mlinson, Cinda Optoelectronics, and Guoxing Optoelectronics will increase the price of RGB lamp beads for display by 5%-10%.

At the same time, this wave of price increases was quickly passed to the downstream LED display field. Helilai and Tianhe Optoelectronics also issued a notice to adjust the price of the product, that is, from the upstream raw material end to the middle and downstream packaging. The product side spread, LED display as a terminal product, naturally not "survived", and the "price war" with the same pulse, the fact that many small and medium-sized enterprises are at a loss, even some industry people call it "pressure The last straw of the dead camel, which shows that it has brought great pressure to some enterprises. It is worth noting that, near the end of 2016, the packaging giants such as Guoxing Optoelectronics can't stand the huge pressure brought by the rising price of the entire LED packaging supply chain. On December 1, 2016, the price of its full range of white LED products will be raised. 5-20%, and Sanan Optoelectronics once again "pays high hopes", starting its January 30th of the year, its S-30MB/S-32BB series wafer products will be raised by 8%, opening the 2017 LED industry price hike In 2017, the trend of LED display price increases still showed an increasing trend.

In terms of industry structure, the number of SMEs in China's LED display industry is still very large in the entire LED display industry. However, the proportion of SMEs in the entire industry is relatively small. Conditional limitations, product value improvement is relatively lacking, in the current product homogenization is serious, the product does not have a competitive advantage, often have to operate in a price-fixed manner, its drawbacks are further reflected in the past two years, directly or indirectly Related LEDs show that enterprises have closed down, and with the emergence of sophisticated technologies such as naked-eye 3D, AR/VR, and MircoLED displays, the impact of OLED bursts in the display field, and technological innovations triggered by the global wave of wisdom, low-tech, The single-function LED display has gradually failed to keep pace with the development of the times, and its drawbacks are increasingly intensified. Traditional enterprises that lack self-styled innovation will be eliminated by the market. In 2017, a new round of LED display enterprises will be closed. The industry's shuffling process has intensified and will be more apparent.

There are many factors affecting the "price increase". On the one hand, the demand for LED display is increasing. We know that a very obvious phenomenon in 2016 is that the small-pitch LED display ushered in a big explosion in the market, small pitch and traditional LED. The display screen has a breakthrough change in terms of function and screen display effect. The market effect brought by it is to trigger the upgrading of LED display products, and on the other hand, it shows in the new market expansion of LED display. Strong penetration, market demand continues to expand, this trend will be more obvious in 2017; in addition, due to the very high density of the lamp pitch of the small pitch, this makes the demand for RGB lamp beads small pitch The geometric multiples increase, directly causing the supply of lamp raw materials and the cost of packaging.

In addition, the impact of environmental protection policies cannot be ignored. With the continuous deepening of environmental protection concepts, environmental governance has become increasingly urgent. The promotion of “energy saving and emission reduction” has been deepening, and the state has strengthened the rectification of enterprises that do not meet environmental protection requirements. As an example of environmental remediation, the Central Fourth Environmental Protection Inspector Group stationed in Guangdong, focusing on the rectification of hardware, plastics, and chemical industries. On the one hand, it forced many factories to be forced to suspend production rectification, and the environmental burden of enterprises increased. The closure of enterprises has caused the LED display-related supply chain to shrink. On the other hand, under the high pressure of environmental governance in some areas, some enterprises have moved outwards, directly causing the supply of related products and raw materials in the region, and the regional product supply structure. Being destroyed, LED display manufacturers need to obtain raw materials from other places, which will inevitably increase the cost of transportation. On January 18, 2017, the Ministry of Environmental Protection issued the “Measures for the Management of Soils in Polluted Lands” and the newly passed Environmental Protection Tax Law, which was implemented on January 1, 2018, and other environmental protection policies have been issued. The actions of China's environmental management and control will be further strengthened. In the future, the pressure on the business burden of enterprises will continue. In 2017, the price of raw materials of some enterprises will continue to rise.

Although the LED display "price increase" has become the focus of the industry, and in the LED display industry has set off a big storm, but the industry as a whole is more rational on this round of price increases, and regard it as "accelerated LED The driving force of the display industry adjustment. On the one hand, “price increase” will accelerate the reshuffle of the LED display industry. Those companies that lack innovation will either be cleaned up, upgraded products, take innovative development routes, or be acquired by large enterprises. Under the constant turmoil of the price, the pressure on SMEs will further intensify. In 2017, the tide of mergers and acquisitions in the LED industry will appear to be intensifying. Of course, it is not only being swallowed. The price increase actually reflects the obvious warming trend of the LED display industry. Looking at the market performance of LED display in 2016, with the small-pitch LED display as the traction, the market has unprecedented vitality and potential. Huge, in fact, is also an opportunity for some enterprises, so some corporate restructuring and innovation performance is obvious, in the future, the "small group" style of the group will be further reflected, and the earlier Sanan system, Huacan system, Mulinsen system and other systems It will be further developed and consolidated in 2017.

In addition, it is worth exploring that this wave of price increases caused by upstream raw materials may further promote the diversification of the entire industry chain, especially downstream products. We know that LED display products are very engineered. It is precisely because of this feature that the LED display extends a lot of sub-divisions, and the market space is huge, under the unfavorable external environment, the internal competition for food, and the homogenization of the entire domestic LED display, the product There is still a lot of room for improvement. "Poverty will change, change will be through". Some enterprises may take a different approach and take differentiated development as a consideration. In this sense, "not taking the usual path" will become the embodiment of enterprise breakthrough. First, the development trend of diversified LED display industry enterprises in 2017 will be more obvious.

In general, affected by the macroeconomic structure and regulation, the national supply-side reform will be further deepened in the future, and the major environmental promotion factors for the rise in bulk raw material prices are still maintained, and there is an increasing trend. In 2017, the LED display industry, especially SMEs with weak strength still need to deal with the impact of “price hikes” in the cold winter. In addition, with the continuous strengthening of environmental protection and control, the burden of enterprises continues to increase, while the global economic recovery is slow and still maintains. Under the downturn, it will inevitably affect the overall economic form of the country. Under the run of multiple forces, the living environment of some LED display companies is still very bad. In 2017, the structural adjustment of the LED display industry will be further reflected.


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