According to the latest ‘ 2017 Global Sapphire and LED Chip Market Report by LEDinside, a division of the global market research firm TrendForce, LED chip market value was USD 6,329 million in 2015, while it grew by 3% to USD 6,502 million in 2016. Since the second half of 2016, Chinese LED packaging manufacturers have scaled up rapidly, targeting applications expected to prevail in the market for the next three years, including general lighting, automotive lighting, and display application. That further fosters Tier 1 Chinese LED chip manufacturers to volume up their productivity.
The Capacity Expansion of Chinese LED Chip Manufacturers Reshuffles 2017’s Productivity Ranking
LEDinside estimates MOCVD equipment (Equiv. K465i) will reach 322 sets in 2017, contributed mainly from China and Malaysia. The market dynamic showed Chinese LED chip manufacturers, including San’an Opto, HC SemiTek, Aucksun, and even IRICO Epilight plan to expand production capacity. Some manufacturers have added equipment into plans since 2H16. It is estimated that in 2017 the total shipments of MOCVD in China will reach 231 sets. Some of the old machines will be phased out of the market, yet in general, China is still the market that will encounter the largest scale of productivity surge, expected to take up to over 50% of the global LED chip manufacturing productivity in 2017.
As for the dynamics in other regions, Osram will complete the construction of its fab in Malaysia by 2017, and the design capacity is expected to volume up after the introduction of manufacturing equipment.
The Capacity Expansion Boosts The Demand for PSS in Chinese Chip Market
In 2016, global LED epi wafer capacity reached TIE 78.4 million pieces and it’s estimated that LED epi wafer capacity will be 114.7 million pieces by 2020. Judging by regions, China is the largest LED epi wafer production base, with 4-inch epi wafer as the major. As Chinese chip manufacturers are still demanding for patterned sapphire substrates, Chinese PSS suppliers volumed up their output on a large scale. The top five Chinese PSS suppliers in 2017 will be reshuffled to be Sinopatt, Jing’An, Rigidtech, ECEC, and Crystal-Optech, of which the production cost control and techniques for yield rate improvement outperform the PSS manufacturers in other regions.
