"From the perspective of general lighting, there will be a dilemma in the short-term, and there is still a long-term expectation, but it needs to change the existing pattern." At the closing ceremony of the 2016 Gaogong LED Annual Meeting, which was named on January 6th, the general manager of Sunshine Lighting I used a word to make an incisive overview of the current status of the LED lighting industry.
This also truly reflects the fact that the LED industry still needs self-revolution in the complex environment of the current industry chain price hike, cross-border mergers and acquisitions tide.
Short-term difficulties
From January to September this year, the export value of lighting products was US$28.56 billion, down 13.9% year-on-year, the first decline since 2009. Tungsten halogen lamps are rising, and incandescent lamps are falling. From the export data, the industry has shown some cold and warm conditions.
Fortunately, in the past three years, as long as the listed companies of LED applications, including packaged companies, sales and profits are double-digit growth, but we feel that there are still some bottlenecks in the next few years.
The global new lighting market is expected to be 3% per year. This replacement market is growing rapidly, but the life of LEDs will be longer, resulting in a relatively longer replacement cycle. Once the balance is reached, the replacement rate is on the ceiling, and no one can tell exactly what the replacement rate of the LED will be in the future.
The light source is not very high in terms of market penetration, only 10% in 2015. It is still possible to increase the penetration rate by 10% per year, but in terms of shipments, 2016 is the shipment of 2.2 billion LEDs. The annual shipment of fluorescent lamps is 4.5 billion, and in 2015 it fell to 2.2 billion. So the number of LED shipments is not low, and growth is continuing, but the growth rate has slowed down, including the price decline.
Lamps are also facing similar problems, but not as serious as light sources. The proportion of newly added lights in the market is about 3%-4%, which is not high. There are now 25 billion sets on the market, which means that it can grow to 28.3 billion sets in 2020.
Because the luminaire is not a means of subsistence, it belongs to the means of production. Because it is installed in a shopping mall or a hotel, it needs a new luminaire to drive consumption. It is not replaced until it is broken. This is the difference between a luminaire and a light source.
Where does the growth in LED sales come from?
In the past few years, we have been lighting companies, and the scale of revenue has generally changed from more than one billion to two billion to more than three billion and four billion.
This is mainly based on the following factors:
1, the price of LED is two to three times higher than the price of traditional light source; 2, the original fluorescent lamp and the person who makes incandescent lamp, outdoor light, there is no way to switch the three luminous platforms, and the LED is very easy to switch; this leads to LED In the era of lighting, enterprises have entered the full-category production mode; 3. The growth of the sales model is a relatively simple enclosure mode.
For example, when new lighting is done, the way to do it is to have no point here, open an office, develop local dealers, and fill the blank market with this model to grow, but this is called natural growth.
But like developing countries, when they reach a certain level and the per capita income reaches 10,000 US dollars, there is a “middle income trapâ€, so the LED growth model can no longer rely on the simple traditional lighting sales model to achieve future growth.
For the recent price hike in the LED industry, Guan Yong believes that the current factors leading to the price increase of the LED industry chain are not simply the relationship between supply and demand.
For example, LED companies only need to use imported materials, because the exchange rate has increased by more than 10%, and the purchase price of this material is equivalent to an increase of more than 10%. In the next stage, due to environmental pressures, the carton has recently increased by 40%-50%. It is actually a simple environmental policy pressure, no special factors. Copper and steel rose particularly sharply, but in fact, the upstream iron ore did not increase in price, but the merger of Baosteel and Wuhan Iron and Steel began to increase prices, because its voice has increased.
The current price hike will have a big impact on the LED industry in the first half of 2017, but I don't think it will last.
But you have to let it fall back to its original level and it takes a long time to digest. In the past few years, if there is no real transformation and upgrading of enterprises, in the next development cycle, there will be a “stagflation cycle†in revenue growth.
The LED industry is long-awaited
The revolution in LED lighting technology has just arrived at the middle, and a new wave of IoT technology revolution will create new opportunities in the collision with the development of the lighting industry.
1, LED dimming, color temperature, color adjustment requirements are activated, bringing lighting products to upgrade and replace. If your lights are not colorable now, your lights will not be sold. Three years ago, I just switched fluorescent lamps to LEDs, but when all the lamps became LEDs, it had a second upgrade opportunity, which required us to do the lighting.
2, lighting + sensing + control brings hardware upgrades and replacements. Many companies are doing it, but the problem is that there is no scene, it is a single product, there is no scene, it will not form a sense of experience dependence, it will not appear the real demand to take off. But this is our opportunity. In the long run, we are still looking forward to it.
However, there are many difficulties in this area, and the technology is very complicated. As a result, even if technology emerges, there is no way to interconnect and influence the universality of use; the light control itself has not yet formed a market demand; the LED light source and the light fixture are a digital product. The weak electricity and digital industries began to infiltrate into the field of strong electricity and lighting. They will also eat away some of the market in the layout.
But no matter what, we need to make changes in the pattern, whether it is optimistic or pessimistic, you have to do things, and not doing things will not change the pattern.
In the agricultural era, it takes three generations to create a rich man. In the industrial age, two generations are needed. In the Internet era, it takes only ten years to produce a rich man.
Sunshine Lighting achieved revenues from 0 to 1 billion yuan in the first 30 years. From 2005 to 2012, revenues rose to more than 2 billion yuan. By 2016, revenues exceeded 4 billion yuan. . Therefore, starting in 2013, the scale of the company will reach a new level almost every two years.
So, the pattern is changing, you have to run slower, you may disappear.
For the future, Guan Yong believes that companies must make changes to their own patterns.
1. Manufacturing platform upgrade: per capita output value rises. Is this business a good manufacturing platform? If not, you will not be able to make a road.
2, product innovation and upgrading: how much sales are brought about by product innovation, if the proportion is very low, are following others, this road has no chance to go on.
3. Business form upgrade: Add some new business forms, such as value-added and service-oriented business proportions.
4, sales model upgrade: to create excellent segment brands and regional brands.
The curtain of the industrial integration pattern has just been opened, the upstream has achieved a relatively concentrated market share, the midstream package is also fast, the downstream curtain has just been opened, and the traditional downstream lighting companies are more or less back. Back, why go back? Because there is integration happening.
In addition, the LED lighting industry in particular needs supply-side reforms to clean up zombie companies, eliminate backward production capacity, and create new growth points.
The LED lighting supply side reform solves the problem of unequal demand and production. The light source we are doing now is good, the lamps are good, the products are too consistent and too close, how to solve it? It can only rely on integration and supply-side reform. This is the plan. Including international division of labor, India, Latin America, the United States, manufacturing returns to the United States, in the manufacturing process to challenge the status of the Chinese manufacturing industry, how to deal with? This is a very real thing.
How to improve the per capita output value of LED lighting companies, how to bring industry 4.0, automation, information into the enterprise, this is a very hot topic. If LED lighting manufacturers do not talk about these contents, there will be problems in the next round of international industry division of labor.
Finally, Guan Yong gave his own definition of the ten-year node of the LED industry in one sentence: the past ten years, the decade of LED turbulence; the next decade is the decade when Chinese lighting companies entered the world famous lighting enterprises.
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