Analysis of the Regional Competitive Landscape of China's LED Lighting Industry in 2020
Source: 中国之光网|| Views: 940
1. LED Industry: Most concentrated development in the Pearl River Delta and Yangtze River Delta The development of China's LED industry originated from the "National High-Tech Research and Development Program" (abbreviated as the 863 Program) proposed in 2013. China's LED industry started later than that of developed countries, with the Pearl River Delta region being the first to undertake the transfer and industrial layout of the foreign LED industry. From a regional distribution perspective, China's LED industry can be divided into five major economic industrial zones: the Yangtze River Delta Economic Zone, the Bohai Rim Economic Industrial Zone, the Pearl River Delta Economic Industrial Zone, the Fujian-Jiangxi Economic Industrial Zone, and the Central and Western Economic Industrial Zone. Overall, the Pearl River Delta and the Yangtze River Delta are the regions in China with the highest concentration of the LED industry. The upstream, midstream, and downstream supply chain is relatively complete, hosting more than 80% of the country's related enterprises. These are also the fastest-growing regions for domestic LED industry development, with significant comprehensive industrial advantages. Suppliers of LED-related equipment and raw materials have successively established their presence in these two regions.
2. Comparison of the Start Time of the LED Industry: The Pearl River Delta Started Early In the early 2000s, facing the huge business opportunities and development prospects of the LED industry, countries around the world successively invested heavily to launch semiconductor lighting plans. In 2000, the United States invested $500 million to implement the "National Semiconductor Lighting Plan"; in July 2000, the European Union announced the launch of the semiconductor lighting "Rainbow Plan". From 2000 to 2008, the South Korean government invested $472 million, and enterprises invested $736 million in the "GaN Semiconductor Development Plan". In June 2003, China's Ministry of Science and Technology, with the support of the "863" Program, first proposed the development of a semiconductor lighting plan.
Since the proposal of the semiconductor lighting development plan, China's semiconductor lighting industry has continued to grow. In 2005, a major project on key industrialization technologies for semiconductor lighting was launched. By 2006, the Ministry of Science and Technology had successfully approved Shanghai, Dalian, Nanchang, Xiamen, and Shenzhen as industrialization bases, with Shenzhen experiencing particularly rapid development. In 2019, Shenzhen took the lead in issuing policies requiring the retrofitting of luminaires in public buildings within its administrative area to LED. Among them, the Pearl River Delta region was the earliest to undertake the transfer and industrial layout of the foreign LED industry. It started development earlier, has richer development experience, and is the most mature and complete in the mid-to-downstream LED packaging and application fields.
3. LED Lighting Policy Planning Comparison: Pearl River Delta Leads in Innovation Many cities in the Pearl River Delta region have introduced proactive policies for the LED lighting industry. Shenzhen, in particular, has been at the forefront nationwide through continuous policy innovation. As early as May 2012, Guangdong Province began researching and deploying the comprehensive promotion of LED lighting products in public lighting. In 2019, the Shenzhen Housing and Construction Bureau vigorously promoted energy-saving retrofits for public buildings, with most projects involving the replacement of LED luminaires, setting a national example.
Support policies for the LED lighting industry in many cities across the Yangtze River Delta region also cover public building renovations. For example, in October 2019, Yangzhou City carried out energy-saving retrofits for courtyard lights in 56 residential communities, river embankments, and squares along Yangzijiang Road and Nantong Road, replacing and installing approximately 10,903 LED luminaires in total.
A comparison of LED industry policies in the Pearl River Delta and the Yangtze River Delta reveals that while both regions have similar support policies for the LED industry, the Pearl River Delta offers stronger support and implemented policy guidance for its regional LED industry earlier, which is conducive to the long-term development of the LED industry in the Pearl River Delta region. 4. LED Lighting Cluster Advantages Comparison: Concentration of the LED Lighting Industry in the Pearl River Delta Driven by the "National Semiconductor Lighting Engineering" initiative, seven national industrialization bases for semiconductor lighting engineering have been established in Shanghai, Dalian, Nanchang, Xiamen, Shenzhen, Yangzhou, and Shijiazhuang. The Chinese government vigorously promotes semiconductor lighting industrial bases or parks, carries out investment promotion, supports leading manufacturers, and introduces relevant support policies to advance the development of the semiconductor lighting industry, resulting in widespread growth of China's LED industrial bases. Among the 20 LED lighting industrial bases nationwide, the Pearl River Delta region accounts for 8, while the Yangtze River Delta region accounts for 4; the number of LED lighting industrial bases in the Pearl River Delta is approximately twice that of the Yangtze River Delta.
In 2008, Guangdong Province issued the "Outline of the Reform and Development Plan for the Pearl River Delta Region (2008-2020)", introducing multiple measures to adjust the economic structure and transform the growth model. Driven by the implementation of this strategic planning outline, the Pearl River Delta is gradually forming three economic circles: "Shenzhen-Dongguan-Huizhou", "Zhuhai-Zhongshan-Jiangmen", and "Guangzhou-Foshan-Zhaoqing". The LED industry within these three economic circles is also developing its own distinct characteristics. Shenzhen and Dongguan, as national-level semiconductor lighting industrialization bases, have the most mature LED industry development in the Shenzhen-Dongguan-Huizhou region, with the most complete supporting facilities and the largest industry scale in the Pearl River Delta.
As the leader of the domestic LED industry, the Pearl River Delta region is currently the largest LED industry cluster area in China. Among them, Shenzhen's LED lighting industry has the largest scale, with complete supporting facilities, a complete supply chain, and strong R&D capabilities. Guangzhou has strong capabilities in packaging and applications, with robust industrial R&D and testing resources; Huizhou's LED enterprises are few in number, but include some companies of considerable scale.
5. LED Lighting Industry / Supply chainComparison: The Pearl River Delta region has a complete supply chain The LED lighting industry can be broadly divided into upstream substrate and epitaxial wafer production, midstream packaging, and downstream applications based on its manufacturing process. Among global LED packaging enterprises, more than 70% are located in China, with 50% of China's LED packaging companies concentrated in the Pearl River Delta. The Pearl River Delta region holds a significant share in various downstream application fields such as LED displays, LED lighting, LED backlighting, and LED plant growth lights.
In the Pearl River Delta LED lighting industry, not only Shenzhen, but also Huizhou, Zhongshan, Foshan, Dongguan and other cities have relatively complete LED lighting industry / supply chain. Huizhou has formed an industrial chain covering LED packaging, professional service providers for LED optoelectronic energy saving solutions, LED lighting product R&D institutions, LED end-user applications, and market sales networks ; Zhongshan has formed an industrial cluster of a certain scale with a relatively complete industrial chain; Foshan shows initial scale in the upstream, midstream and downstream of the LED industry chain, with advantages in downstream luminaire manufacturing; Dongguan has basically vertically integrated the LED industry chain.
Within the Yangtze River Delta LED lighting industry, Shanghai's LED lighting supply chain is relatively well-developed. Jiangsu has already achieved a certain scale in LED packaging and applications, but its full supply chain still needs further development. Ningbo boasts a strong industrial foundation and advantageous economic location; it is a major domestic production base for special-purpose luminaires with significant growth potential.
6. Comprehensive Evaluation: The Pearl River Delta LED Lighting Industry Has Strong Competitive Advantages Overall, the Pearl River Delta region holds a strong competitive advantage in China's LED lighting industry. With an early start, extensive development experience, and innovative policy planning, it is well-positioned for the long-term growth of the LED lighting industry. The LED lighting industry in the Pearl River Delta is highly concentrated, offering significant cluster advantages. In terms of the supply chain, many cities in the region have developed comprehensive LED supply chains, giving the Pearl River Delta a leading overall strength in the LED lighting industry compared to the Yangtze River Delta region.
