First, the price decline tends to ease, and the gross profit margin has gradually stabilized.

In 2012, the domestic LED packaging industry basically continued the price decline since the second half of 2010, and the gross profit margin declined. The price of white light lighting LED fell by more than 10% every quarter.

In 2013, the price of domestic LED devices will continue to continue the trend of price decline, but due to the increase in the penetration rate of medium and large-size backlights and lighting products, the decline in product prices will narrow and the gross profit margin will gradually stabilize.

Second, the reorganization and integration of the LED industry structure. Fierce competition and the huge market potential of the downstream lighting industry have led most midstream companies to enter downstream applications.

According to statistics, more than 90% of packaging companies have entered the downstream application field, and the proportion of application output value is rising;

Some LED packaging companies choose joint ventures and other means to enter the LED downstream, providing downstream outlets for their products. Build LED lighting channels in downstream applications and share the market cake of LED lighting applications.

Third, the existing packaging technologies and processes are no longer sufficient to support the continued decline in costs, and revolutionary technological breakthroughs are needed.

However, due to the small scale, insufficient funds and lack of upstream technical support for domestic LED packaging companies, the current research and development of new technologies tends to be conservative.

Generally in the wait-and-see period. In the short term, the price of LED packaging products will decline, and companies with economies of scale and a robust upstream chip supply chain will have a certain comparative advantage in the competition.