iSuppli predicts global LED supply shortage in 2010

   On March 8th, the market research organization iSuppli said that in 2010, the global supply of light-emitting diodes (LEDs) will face a shortage. If the production capacity of LEDs does not increase, then in 2010, the market will face a large number of required equipment. Serious supply ended in short supply.

In 2009, the total sales of LEDs reached 63 billion, up from 57 billion in 2008.


Global LED shipments from 2006 to 2013

As demand is clearly exceeding supply, and in the next three years, the LED market is expected to show double-digit growth. iSuppli predicts that if this year's additional capacity is still unable to meet the growing demand, then there may be a serious shortage of supply this year.

Laptops typically use 50 LEDs, or the display uses about 100 LEDs. For average consumption, LCD TV panels use between 300 and 500 LEDs. Since LCD TVs use LED backlights and require high uniformity, the supply shortage faced by LEDs in this industry will become a major factor affecting TV panels.

At present, LEDs are used in a wide range of applications, not only for backlighting, but also for large-size LCD TVs, computer screens, and small LCD monitors, including notebook computers, cell phones, portable navigation devices, digital photo frames, digital cameras, and keyboards.

In addition, LED solutions are increasingly used in the general lighting market to meet residential, commercial and industrial lighting applications. LEDs are still in their infancy for the general lighting market, but will become the mainstream in the next two years.

Applications for standard brightness LEDs include indicator lights and LED alphanumeric displays. In contrast, high-brightness (HB) LED applications include large-screen LCD screens for flat-panel TVs, notebook computers, and computer monitors. The third is Ultra High Brightness (UHB) LEDs, which can be used in next-generation lighting applications such as general lighting in residential and office settings.

Large-screen LCD monitors will touch the most severely affected pulse of LED shortage

LED supply chain participants are looking for solutions to address the expected supply shortage.

The two main players in the LED industry, Aixtron and Veeco, plan to double their capacity by the fourth quarter of 2010.

The market regulator iSuppli said that the LED industry is taking steps to expand its production capacity from raw materials to wafers, from bare chip production to packaging, and to finished LED luminaires. However, the increase in capacity will take time.

For LED panel suppliers, their strategy will be to address supply shortages, including vertical integration and internal procurement.

Take Samsung Electronics as an example. The company has already entered into a joint venture with its Samsung Electro-Mechanics, and LG Display has formed an alliance with LG Innotek. Chi Mei Optoelectronics and AU Optronics are two major LED panel suppliers, and are actively developing their own internal LED purchases to ensure the continued supply of their respective equipment. (China Semiconductor Lighting Network)

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