2023-04-12
In 2022, the global LED market was affected by the "sluggish consumption" and the shift from European and American monetary policies to interest rate hikes, which had a negative impact on the global macroeconomic situation and presented a weak overall pattern. However, in contrast to the overall weakness of the industry, emerging core businesses represented by Micro LED have still achieved growth and new breakthroughs.
For example, BOE's financial report shows that MLED business has achieved revenue of approximately 847 million yuan from 2022, a year-on-year increase of approximately 84.79%. JD's direct display COG P0.9, COB P0.9~1.5 full series products have been mass-produced by multiple brand customers, and LTPS technology has achieved box lighting and sample delivery. According to Lyad's financial report, Micro LED display products achieved orders of 400 million yuan in 2022, an increase of 25% compared to 2021. Micro LED leader Neptunium Chuang in Taiwan, China, saw a year-on-year increase of 41.83% in revenue in 2022... According to research by relevant institutions, MLED mainly targets the small pitch LED display screen market, with a global market size of 4.2 billion US dollars in 2022, an increase of 12% compared to 2021.
In the overall weak market of the LED industry in 2022, the growth potential of Micro LED has become more prominent and has become the "common focus" of top LED direct display enterprises. This has also led to a significant expansion of Micro LED investment.
According to statistical data released by CINNO Research, the investment amount for Mini/Micro LED (MLED) and module projects in China (including Taiwan) in 2022 was approximately 55 billion yuan. According to media reports, in the first three months of this year alone, nearly 30 billion yuan of investment plans for projects have entered the MLED market. Since 2020, the pattern of accelerated investment and focus in the MLED industry has continued, and there is a trend of acceleration. Projects have formed a comprehensive flowering and chain resonance pattern from upstream chips, midstream packaging, modules, to downstream panels, LED screens, and other links in the industry, and will continue to have production capacity in 2022. Industry research suggests that 2023-2025 will be the explosive period for this round of MLED investment with production capacity exceeding 200 billion yuan.
The acceleration of MLED investment is most significant in the financial reports of device end enterprises. For example, Zhongwei Company stated that its flagship product, MOCVD equipment, has achieved a leading position in the Mini LED blue-green LED production line. In 2022, MOCVD equipment revenue was 700 million yuan, an increase of approximately 39.05% compared to 2021. The MOCVD reactor is the core equipment that determines the future production capacity of the LED industry, and its market growth reflects the expansion of the entire industry.
According to industry insiders' predictions, the global demand for Micro LEDs is expected to exceed 50 billion by 2024, more than 10 times that of 2022. Industry research institutions predict that the global Micro LED market size will exceed $3.5 billion by 2025, and the global Micro LED market size is expected to exceed the $10 billion mark by 2027—— Over a period of 5 years, it has grown by nearly 10 times.
The future of taking all, Micro LED condenses the industry's imagination
The high growth of Micro LED products and the industry's enthusiastic expectations for the future are in one continuous line. This is mainly due to the broad application prospects of Micro LEDs and the expected trend of cost reduction.
From an application perspective, Micro LED is a take-all technology. Firstly, Micro LED displays not only cover traditional LED direct display large screens, but also extensively penetrate the micro display and small to medium-sized display markets. Micro LED displays cover the market from 0. X-inch AR mini displays to 1. X-inch smart watches, small and medium-sized handheld devices and vehicles, medium to large sizes in IT and TV, and the ultra large screen engineering market of traditional LED direct display. Secondly, in the LED large screen direct display market, Micro LEDs not only cover the 0. X spacing micro spacing market, but also meet the indoor and outdoor ultra fine display needs of a wide range of P1.0 to P3.0.
From the perspective of cost changes, Zhouming Technology, the champion brand in the LED display screen manufacturing industry, pointed out that China is completely independent and controllable in the LED industry chain, and is also at a world leading level. MLED product costs are in a natural decline process, and overall comply with the industry pattern of annual cost reduction of about 20%. Huang Yuzun, Sales Director of LED packaging material manufacturer Chenri Technology, once pointed out that some solutions in the LED industry that use domestic materials can be discounted by up to 50%. In a survey conducted by financial professionals, Lehman Optoelectronics stated that with the continuous development and maturity of Micro LED technology, processes, and supporting industry chains in recent years, the cost of Micro LED displays is decreasing by an annual rate of 10% -15%.
Especially since 2022, MIP packaging solutions have been widely recognized. This provides a more open, standardized, and flexible Micro LED display core technology solution from upstream to downstream terminals, and also has better inheritance and compatibility with downstream equipment, materials, and processes in the existing industrial chain. Industry research suggests that MIP packaging solutions will drive the expansion of Micro LED application scope and continue to reduce costs under standardization and scaling.
At the same time, the advancement of industry technology and the improvement of LED luminous efficiency will lead to the miniaturization of Mini/Micro LED chips. In the future, more Micro LED chips can be obtained from the same wafer, and the cost of Micro LED chips will decrease accordingly. At present, another reason for the high cost of Micro LED is also due to insufficient production capacity. In the future, more and more chip manufacturers will invest in the Micro LED industry chain, which will also help improve yield and reduce price costs.
Over the years, the development of the LED direct display industry has also shown that Micro LED continues to expand its application scope and reduce costs, driving the industry's growth. For example, in 2022, the P0.9 LED direct display product became the "hottest" display specification for the first time, with a significant increase in sales revenue. According to statistics from Lotu, in 2022, the sales revenue of LED direct display products with a spacing below P1.0 in China reached 12.5%, with the market size approaching doubling, with P0.9 products accounting for the majority of the market share—— Promoting the popularization of P0.9 in batches, actively laying out P0.7, and developing and expanding P0.3-p0.5 have become the consensus of leading enterprises in the industry.
In the past 10 years, small pitch LED direct displays have upgraded from P1.5 as a profit center product to P0.9 as a profit center product in 2022, and the market application scope is becoming increasingly broad. Among them, the early market prices of P1.5, P1.2 and P0.9 products were all above RMB100000 to RMB150000 per square meter, while the average prices of these three products have dropped to RMB20000, RMB40000 to RMB50000 and RMB70000 to RMB90000 respectively.
The positive feedback of "technological progress, price decline, and expansion of application scenarios" has been applicable to the LED direct display industry in the past and will continue to be applicable to the Micro LED era in the future.
Seizing market opportunities and creating a sense of urgency in the industry
If you want to have a foothold in the future LED market, Micro LED is not only an overtaking curve, but also a threshold for future market position! "Industry insiders pointed out that the acceleration of Micro LED investment in recent years indicates not only opportunities, but also a battle for market entry.
Especially in 2023, the domestic market has come to an end to the special period of the pandemic in the past three years, and social and economic activities and consumer life have fully returned to normal. Against the backdrop of internal demand restart and accelerated development of internal circulation, the display explosion of Micro LED is bound to accelerate. Industry insiders predict that 2022 will be the first year for Micro LED direct display growth, and 2023 will be the beginning of the explosion: the industry predicts that the sales of small pitch LED in the domestic market will return to growth in 2023 and may reach double-digit increments.
Among them, according to the predicted construction period from 2020 to 2021, the first batch of production capacity invested in the Mini/Micro LED industry will accelerate its expansion in 2023, thereby increasing the penetration rate of new technologies such as Micro on the supply side, and further opening up growth space for the industry market. In this context, seizing the share of production capacity has become another strategic focus that industry enterprises must strive for beyond technological breakthroughs.
In summary, combined with technological progress and continuous investment, the high growth of the Micro LED market in the future is expected, and it will also bring a new round of "market expansion and brand reshuffle" opportunities for the LED direct display industry.
