Opportunities and challenges facing China's LED industry
——Conversation 泓Yaguang General Manager Chang Baoyan
Reporter: "Yu Yaguang" Enterprise Journal Special Reporter Xiong Xiong
On September 15th, 2008, the famous American investment bank Lehman Brothers declared bankruptcy, and a financial crisis sweeping the world kicked off. Today, the crisis has passed for a whole year. What kind of adverse impact does this sudden financial crisis have on China's LED industry? How should we reflect and respond? What opportunities and challenges does China's LED industry face in the new situation?
On October 17th, the editorial department of this newspaper sent a reporter to an exclusive interview with Mr. Chang Baoyan, the national high-tech enterprise, the vice president unit of Shenzhen LED Industry Association and the general manager of Shenzhen Yuyaguang Electronics Co., Ltd.
Reporter : Hello General Manager! Thank you for taking the time to accept our interview. It has been a year since the first US financial crisis that broke out and eventually swept the world. What significant impact does this crisis have on China's LED industry?
Chang Baoyan : On October 14th, I was invited by the National Semiconductor Lighting Engineering R&D and Industry Alliance and the Shenzhen Municipal Government to participate in the 6th China International Semiconductor Lighting Exhibition and Forum (CHINA SSL 2009), during the meeting and many government officials. The well-known entrepreneurs of LED experts, optoelectronics and semiconductor industry have carefully communicated and understood, and can clearly feel the many impacts brought by the financial crisis. It has made the LED industry show a new development trend: the competition in the middle and upper reaches of the industry has intensified, and some enterprises in the downstream industry have been eliminated; due to the accelerated entry of foreign capital, the domestic market segmentation has accelerated. Large companies in Europe, America and Japan are the least affected by the monopoly of core technologies such as chips. Many SMEs that do not have core technology are the most affected. Some SMEs that produce low value-added products have closed down or stopped working. At the same time, with the world-famous optoelectronics companies such as Nichia and Phillips entering the domestic market, the market competition is more intense.
It can be said that the financial crisis has accelerated the reshuffle of the LED industry, which has difficulties and business opportunities. Therefore, the domestic LED industry is facing challenges and opportunities!
Reporter : What opportunities and challenges will China's LED industry face in the new situation?
Chang Baoyan : In order to cope with the financial crisis, China has successively issued a series of economic stimulus policies with the main contents of “expanding domestic demand†and “energy saving and emission reductionâ€, which also makes the LED industry face a historical opportunity of accelerating development. The Ministry of Science and Technology, provinces and municipalities have attached great importance to the development of the LED industry and increased support, such as actively promoting the “Ten Cities and Ten Thousand Lights†demonstration project. At present, Shenzhen has been vigorously promoting this project, installing more than 2,000 LED street lights, promoting industrial upgrading and product replacement, which makes the LED industry face a rare development opportunity.
At the same time, China's LED industry is also facing many challenges such as high price of lighting products, unbalanced industrial structure, lack of independent intellectual property rights, and the formation of large-scale market. With the world-famous optoelectronics companies such as Nichia and Phillips entering the domestic market, the market competition is more intense. How to seize opportunities, overcome difficulties, and strengthen and expand the LED industry is a major issue before us.
Reporter : As a mid-stream and downstream enterprise with LED packaging, LED high-power and lighting applications, how should we deal with it?
Chang Baoyan : Since the outbreak of the financial crisis last year, Shenzhen Minlai Yaguang Electronics Co., Ltd. and Shenzhen Hao Lighting Technology Co., Ltd. have re-adjusted their market strategies, actively practicing internal strength, seeking practical results, and have withstood the severe test brought about by the financial crisis. The company not only develops healthily, but also receives good economic and social benefits. I personally think that LED middle and lower reaches mainly do the following work:
First, do a good job in market forecasting and improve product quality. Due to the reshuffle of the LED industry, market segmentation, product structure should also be adjusted. At the beginning of the year, we first set up the market, set products, set models, and set materials to form our own fist products and competitive advantages. In February, we upgraded the ISO9000 (2008 version) quality management system to meet the needs of customers with good product quality, thus ensuring the healthy development of the company.
Second, do a good job in technological innovation and effectively reduce costs. “Science and technology are the primary productive forcesâ€. From the beginning to the end, the company puts technological innovation at the forefront, effectively reducing costs, improving quality, and improving market competitiveness with technological advancement. In 2009, we actively used the government's support policy for the LED industry, and achieved breakthroughs in the review of scientific research projects. The accumulated support bonus of several million yuan has promoted the rapid development of enterprises. In July, it successfully passed the national high-tech enterprise certification. In August, the high-power street lamps obtained national invention patents, which is another important guarantee for the accelerated development of enterprises.
Third, build an efficient team and strengthen internal management. We attach great importance to the "people-oriented" management philosophy, create a good environment, respect talents, train talents, and actively create a first-class management team, and benefit from management.
Fourth, strengthen patent declaration work and protect intellectual property rights.
We believe that through the joint efforts of all parties, our LED industry will be able to continue to grow and develop in the fierce market competition and create a bright future!
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