The subsequent expansion of LED chips has revived the small and medium-sized manufacturers "pressure mountain"

[Text / Long Zonghui] Recently, there have been rumors in the industry that because of the shortage of lighting chips, chip manufacturers represented by Sanan Optoelectronics (600703.SH) will take the lead in raising prices.

The reporter called Wang Qing, the director of Sanan Optoelectronics. He said that the current price of the chip has not risen, and the company will not plan to increase the price of the chip in the second half of the year. However, the current lighting chips are indeed tight, which is a common problem in the industry. The company may properly deploy the backlight and lighting chip capacity according to market conditions.

On April 9, Sanan Optoelectronics issued an announcement. The board of directors passed the “Investment Agreement” signed by the company and the Xiamen Torch Development Management Committee. The company decided to change the implementation site of Wuhu Optoelectronics Industrialization (Phase II) project to the torch of Xiamen, Fujian Province. High-tech Zone (Xiang'an) Industrial Zone. According to the "Investment Agreement", the total investment of the project is 10 billion yuan, the total scale is 200 MOCVD (converted by 2 inches and 54 pieces), and 100 MOCVD equipments are started in the first phase. The construction period is one year, all the workshops and related production. The supporting facilities will be completed within two years, and the remaining 100 MOCVD will be started after the first phase of the equipment is fully put into operation, and will be put into use no later than the end of 2018.

On November 8, 2013, the first phase of the epitaxial chip project invested by Huacan Optoelectronics (300323.SZ) in the Zhangjiagang Economic and Technological Development Zone in Jiangsu Province was announced to be completed and put into production. The current production capacity has begun to be released. At the same time as the completion of the first phase of the project, Huacan Optoelectronics Suzhou Phase II Red and Yellow Light Chip Project has also broken ground. The products produced in the second phase of the project are high-brightness red and yellow LED chips. After the project is completed, it will have an annual production capacity of 480,000 LED epitaxial wafers and 15.4 billion LED chips.

In fact, most of the mainland chip factories were initially positioned in LED lighting chips. Only a few chip factories such as Sanan Optoelectronics, Shanghai Blu-ray, and Inspur Huaguang were involved in backlight chips. Last year, due to the large-scale conversion of backlight production capacity to lighting, the losses were further deepened. The possibility of a domestic conversion like Yuanyuan is not too great. For the current expansion operation, the second and third line chip factories generally expressed "pressure mountain".

Jiang Zhongyong, general manager of Silan Mingxin, said that the chip is generally not easy to raise prices, and it is not necessarily acceptable for customers to go up. After the production capacity of the Huacan Zhangjiagang project and Sanan Optoelectronics' expansion project is released, the production capacity will definitely be oversupplied, and the price will fall again. The chip belongs to a kind of industrial products. As the process becomes more and more mature, the scale advantage of the small factory is not obvious. The order will definitely eventually be assembled to the big factory. Silan Mingxin has just purchased 2 MOCVD to eliminate the old machine, the future. Also need to expand production.

Zheng Tiemin also expressed a similar point of view. He believes that even if the red-yellow chip with relatively high gross profit has a lot of profit compared with the beginning, the chip factory will not be able to do so. In fact, the demand for red and yellow light chips is much smaller than that of blue light. Most of the blue light is used for white light illumination, and the red light chip is generally used for display and landscape lighting. Some high-end customers need to design intelligent dimming lamps, which will use three-color chip to mix light to process white light. However, because the price is relatively high, the demand is not large, and the production risk of red and yellow chips is inevitable.

At the same time, he believes that although the production capacity of lighting chips is tight now, it is not the time to expand production, because the profit margin of the chip factory is still very narrow. Although the demand is here, the new equipment is not very attractive to investors. Considering the market law, there must be a period of equipment commissioning after the purchase of new equipment. During this period, not only does it require a large amount of financial expenses, but also the cost is relatively high because of the yield and other issues. Now that the profit margin is so small, there is a high risk of doing so at a loss.

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