Nichia’s Market Outlook for 2016

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The sluggish global economy triggered the downtrend in the LED industry in 2015, and next year is expected to be just as challenging for manufacturers in the backlight and general lighting market, said Katsuyuki Akutagawa, Chief Legal & IP Officer and Company Board Director of Nichia (the company) at a press conference held in Mandarin Oriental Taipei, earlier Wednesday.

Even though the market will become increasingly challenging, the top global LED chip maker projected the market would still grow at a moderate pace of about 5% in 2016.

For manufacturers to survive the oncoming “winter” in the industry, Akutagawa advised LED manufacturers including SMEs to invest in R&D and spend time developing advanced lighting technology. “Advancements in LED package technology compared to the past, will make it increasingly difficult for me-too manufacturers to last in the industry,” he added.

Industry mergers and acquisitions are also projected to intensify next year, said Akutagawa. “Only SMEs with technology advantages in niche market lighting applications will be acquired by large manufacturers,” he said. The Japanese company, though, has no intention of acquiring any companies for the time being.