Dec 13, 2017: Sanan Optoelectronics, the largest China-based LED epitaxial wafer and chip manufacturer, has lowered prices for LED chips, for example, by 20% for 2835 models used in lighting products. HC SemiTek, the second largest China-based LED epitaxial wafer and chip manufacturer ahs also reduced prices.
With two giant makers reducing prices will definitely impact the smaller competitors, who struggle to meet up to the prices of the major players. This price cut may compel some of the players to leave the market.
However, Taiwan-based competitor Epistar has not reduced prices, instead it has declined orders coming with low quotes.
According to industry sources, the latest price cuts are yet to have any impact on the market, and have not yet push up demand for LED chips, as the market is still waiting for further reductions. According to market analysts, LED prices are likely to drop further in first quarter 2018.
Despite the price cuts, Sanan will capitalize on the China government’s subsidiies for equipment used for producing III-V compound semiconductors, as it is setting up a production base in Quanzhou, southeastern China, with an investment of US$ 5.03 billion. The facility will manufacture GaN substrates, epitaxial wafers and chips, etc, and production will most probably start from 2022.