2014 LED equipment investment is expected to recover

Following the 2011 45% decline, fell 30% in 2013, with LED overcomes the problem of excess production capacity, 2014 new capital investment will increase, is expected in 2014 LED wafer manufacturing investment will grow 17%, reaching nearly $1 billion 200 million, SEMI said.

Equipment investment also reveals a new era in the LED industry, as the current equipment investment is concentrated in the industry's leading enterprises and aspiring survivors - rather than dispersed in new businesses or new technologies.

LED TV and semiconductor lighting led to the development of the LED market, in the past three years, the LED industry's global capacity expansion, which is partly due to the impact of Chinese government subsidies. 2011 global production capacity increased by 49% in 2012, an increase of 39% this year, continued to grow by 19%. Driven by national and local subsidies and stimulating projects, China's LED manufacturers this year's 4 inch wafer will be increased from 2010 to 100 thousand pieces per month, up to 620 thousand.

These capacity expansion is affected by the 2015 LED market will be increased to more than 20 billion U.S. dollars this year, the impact of such an optimistic forecast 2010-2011. However, the current packaging market forecast for 2015 was only $15 billion, LED compound annual growth rate of less than 5%. The reason for the decline is that the LED forecast to improve light efficiency, packaging LED light efficiency and LED replacement lamp market is small.

Strategies Unlimited believes that the average per thousand lumens of chips from 13$in 2011 has now dropped to $3.65. The number of LED used for TV has been reduced by 1/3, and the number of LED required by many SSL lamps is reduced by half compared with a few years ago. Mobile devices and laptops are also reducing LED. The car is still the growth line market, but currently only 10% of the overall market.

Due to increased production of new company, into a decline in the growth rate, the price of LED packaging in recent years fell sharply, making many companies facing serious economic difficulties, especially those small and medium-sized enterprises and new power production of low margin businesses. Global wafer fabrication is declining, especially in china. MOCVD system is a sharp decline in sales, one of the leading enterprises such as Ace and Vico strong both in 2010 sales growth of 3 times, but the decline in sales in 2012 and 2010.

The decline in the price of Sapphire Wafers offset a decline in the price of some packaged LED, more than 80% of sapphire for the LED industry. Sapphire is now 4 inch wafer price of around $32 (2011 price of $130), while the price of 6 inch wafer is less than $300 (18 months ago $450). 2 inch and 4 inch patterned substrate (PSS) quickly become the standard, the 6 inch product will also become a standard.

Sapphire prices fall as well as silicon carbide competition, so that the penetration of silicon based Gan LED received suppression. Lux Research report shows that SiC and sapphire will continue to dominate the LED market, thanks to capacity improvement and technical improvement. New techniques such as hydride vapor deposition (HVPE) will further improve the output and cut costs, making the sapphire at the 10 year still high competitiveness in the future.

SEMI said that leading manufacturers have invested 6 inch wafer production systems and related equipment to improve yield and output. CREE (SIC) as well as PHILPS and OSRAM (sapphire) has begun to enter the 6 inch wafer.

Nichia continue to increase investment to improve productivity and technology, Taiwan, and new century photoelectric wafer can have significantly increased the production input in this year. Almost all of the leading manufacturers are updating their production systems, including investments in measurement, automation, etching and lithography.

No government subsidies in 2014 China's MOCVD procurement will grow. SEMI is expected in 2014 MOCVD procurement will grow by 50% in 2013 to 150 units. At the same time, many of China's LED manufacturing plants will be closed or acquired.

Chinese three has more than 120 sets of MOCVD, Elec-Tech has 90 units, their factory utilization rate in the promotion, has gradually become a new force. Some medium-sized manufacturers such as LED can raise photoelectric and HC semitek near full capacity, is optimistic about the future. 2014 China will account for 44% of total equipment investment, an increase of 33% over 2013.