LED Market to Improve for Taiwan due to Overall End of Subsidy in China by March 2015

Taiwan's LED makers foresee improving market in China next year due to Beijing's demanding all local governments to end subsidies of homegrown LED makers by March 2015.

Originally having decided to end the central government's subsidies of LED makers, the Chinese State Council recently ordered local governments to also end all  subsidies of LED makers under their regulation by March 2015.

According to the council, although subsidies have substantially helped foster development of the LED industry in China, they have also disrupted market order and the effect of governmental  macroeconomic regulations.

Taiwan's industry executives say such extensive subsidies have  led to excessive supply, with  program termination to sideline  underselling manufacturers and stop Chinese manufacturers from poaching LED specialists from Taiwan.

They estimate at least 85% of China's LED epitaxy-wafer makers to go under upon termination of subsidies to boost sales of makers like Epistar Corp. in Taiwan,  world's No.1 manufacturer of blue LED chips in volume.

Epistar Chairman B.J. Lee say China's epitaxy-wafer makers can not continue underselling  although some of them may accelerate expansion before subsidies end by March 2015.

Unity Opto Technology Co., Ltd. Chairman Alpha Wu, whose company is an LED packager, says Taiwan-made LEDs will be more competitive in China post-subsidy with impressive quality and patented designs.

Wu projects a bright market outlook for Taiwan's LED industry in 2015 due to strong demand from general-lighting, automotive-lighting and handset-backlight markets in addition to subsidies termination in China. (KL)