China's new subsidy policy on the road to increase visibility of LED lighting boom

China's latest edition of the LED lighting subsidy formally launched on the road, which is expected to stimulate the LED industry's prosperity. In order to support the local LED lighting brand factory and speed up the completion of modern power-saving lighting construction, the Chinese mainland government announced a new version of the LED lighting subsidy policy in early March, in particular increasing the LED indoor lighting subsidy measures, is expected to expand the LED lighting equipment to the sea, and then drive the relevant supply Chain vendor revenue growth.

According to Lin Yuanqing, an industry analyst at the Industrial and Industrial Research Center of the Industrial Technology Research Institute, as the LED backlighting market for mainland Chinese manufacturers has failed to catch up with South Korea’s Samsung in terms of technology or capacity, it is seeking new market opportunities. Coupled with the huge domestic demand in mainland China, many companies have begun to actively deploy to the lighting market. At the same time, the Chinese mainland government has also issued a LED lighting subsidy policy to help out, this year will fully nurture the growth of the local LED brand industry, and Taiwan-based Epistar suppliers and packaging and testing plants are also expected to benefit.

Lin Yuanqing further pointed out that in the past, mainland China has placed more emphasis on strengthening infrastructure. Therefore, LED subsidy policy is usually directed at outdoor streetlights, tunnel lights and other devices, but this year, to increase the penetration rate of LED indoor lighting, LED indoor downlights have also been added. Reflective self-ballasted LED lamps and other devices help the industry grow with subsidies ranging from 30 to 50%. The subsidy operation will adopt “indirect subsidy”, which is the price of the final end product after the winning company subtracts the government subsidy price from the agreed price. This kind of subsidy can effectively prevent the unscrupulous manufacturers from gaining profits from it, and it can also make LED lighting equipment more affordable.

According to ITRI statistics, in 2010, the global LED lighting penetration rate was only 5%. In 2011, the European debt crisis crisis was only slightly increased to 6.7%. It is expected that the penetration rate in 2012 is expected to be subsidized in mainland China. The two major factors, such as the release of policies and the continued decline of LED epitaxial and module prices, have stimulated the next move to climb to 9%.

Although the mainland government has clearly stated the percentage of subsidized products and subsidies, it has not announced the total amount of LED subsidy. In this regard, Lin Yuanqing believes that the future will still be regarded as the status of the LED lighting brand in mainland China to know if this subsidy policy helps the LED lighting industry, but in any case, this policy release is undoubtedly broadened. LED lighting equipment to the sea, the overall LED industry still has positive benefits.

On the other hand, due to the poor quality of LED lighting equipment in the "Ten Cities and Ten Thousand Villages" policy implemented in mainland China last year, how to improve the quality of LED lighting equipment is also the focus of Chinese authorities. Lin Yuanqing added that in order to prevent the inflow of inferior products into the market, the new subsidy policy imposes stringent tendering conditions on the capital and production capacity of the manufacturers. For example, the capital of tendering companies must be greater than RMB 50 million, and the outdoor LED lighting production capacity must reach 50,000 or more per year, and the indoor LED lighting must be more than 200,000, so as to filter the quality of the manufacturers, and the Taiwan Department of Epistar The factory and packaging plant can also provide related products and services such as NVC Lighting, FSL Foguang Lighting, Yangming Lighting and other Mainland China brand manufacturers with superior technology and quality to further increase revenue growth.