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Government Subsidies Have Caused Serious Domestic LED Chip Production Overcapacity

By: DeRun   Views:4459  

LED industry, research director of the Institute told reporters that from the listed companies, three safety optoelectronics, BDO Runda is subsidized by the Government more business, because two years ago in the “speculation” upstream, local governments to attract investmentattract investment subsidies as leverage.

The experts believe that if the three safety optoelectronics, the BDO Runda government subsidies removed, the two LED chip listed companies in 2011, 2012 basically a loss.

Government subsidies the Chinese mainland LED industry to accelerate the rise. Zhang analysts say, mainland China LED companies have been difficult to compete with Taiwan and other enterprises with subsidies to grow and scale up the technology development, mainland China LED companies have a competitive strength. Last year, three safety optoelectronics also acquired Taiwan’s Formosa Epistar.

However, government subsidies have caused serious domestic LED chip production overcapacity in the three years 2009, 2010 and 2011 an annual average of more than 20 new LED chip project, up to more than 80 domestic chip companies, now only more than 50 in 2012 out of the more than 20. Many projects upfront investment “bad deal” wasted. Excess capacity also caused the LED chip prices plummeted in 2012 and the first quarter of 2013, many LED listed companies continued momentum of income does not increase profits “.

“Government has wasted investment more, and support to the industry a bit Destructive Enthusiasm.” The experts said.