Price Rise and Shortage May Become the Biggest

Price Rise and Shortage May Become the Biggest "Obstacle" for LED Display Industry in Recent Years It is reported that the major wafer foundries UMC, World Advanced, Liji, SMIC and Gexin will plan to raise their wafer foundry quotations again to cope with the continued tight production capacity. 2021 is less than half, and the rising price of raw materials led by driver IC has not weakened at all, so that some factories can not even guarantee the demand for orders, and China's LED display industry may fall into a "phased shortage dilemma". In fact, the periodic shortage of domestic chips has begun to affect the launch cycle and sales process of high-end new products in the LED display industry, including Micro/Mini LEDs; and small and medium-sized enterprises are also facing the dilemma of "doing more and losing more" and "not taking orders". Price Rise and Shortage May Become the Biggest "Obstacle" for LED Display Industry This Year Upgrading and adjustment of product institutions to accelerate the imbalance between supply and demand In recent years, the consensus of the industry is that there is little profit margin left in the low-end market, and only by increasing the proportion of high-margin products and forming differentiated competition can we maintain sustained profitability. Therefore, the LED display industry continues to upgrade the product structure and reduce the production capacity of low-end products, and major chip manufacturers also adjust their production capacity. In addition to the improvement of gross profit margin of manufacturers, there is also a price increase of low-end LED display chips due to the shortage of supply and demand. At the same time, the global shortage of raw materials such as chips and copper remains unchanged, and the LED display industry has also been greatly affected. In addition, Taiwanese chip manufacturers and large foreign chip manufacturers have transformed into high-end products. For example, Jingdian has shifted most of its production capacity to high-end areas such as Mini LED, indicating that the reduction in production capacity of low-end products has further exacerbated the shortage of supply and demand for these products. Drive up the price. Internal and external attacks, the industry is mired in the quagmire of shortage Since this year, the internal problems caused by external factors (the price of bulk raw materials continues to rise sharply, and the shortage of key components such as chips, etc.) Are continuing to deteriorate, which has brought a lot of resistance to the production, operation and product promotion of leading LED display manufacturers. It's hard to get out of the mud. But at the same time, industry insiders also revealed that the current shortage of many raw materials is not really "out of stock" in essence, but a large number of raw material suppliers are facing rising raw material costs, as well as the purchase price set by enterprises as early as the end of last year, because "the purchase price is lower than the cost price", so they can not guarantee the full supply of components. On the one hand, in order to maintain business and contracts, they can only supply a little, and then try to negotiate with downstream terminal LED display manufacturers to increase the price space; on the other hand, many raw material factories have the intention to withdraw without making money, but they are caught in a dilemma-they will lose money if they continue to produce, and they are afraid of resuming production indefinitely if they stop production. Faced with this situation, many LED display manufacturers said frankly that the rising prices of raw materials and the shortage of chips and other external factors have caused the difficulty of sustainable production and operation of enterprises, which is becoming a "swamp" in the industry this year. Recently, although the relevant ministries and commissions of the state have begun to rectify the continuous soaring of bulk raw materials, the high level of raw materials and the periodic shortage of raw materials such as chips have basically not found an effective solution this year. Moreover, this series of problems, which can not be effectively controlled in the short term, may become the external resistance that troubles many manufacturers'market operation activities in the next stage. Disclaimer: Part of the article information from the network and the net friend contribution, this website is only responsible for the article collation, typesetting, editing, is for the purpose of transmitting more information, does not mean to agree with its point of view or confirm the authenticity of its content, such as this site articles and manuscripts related to copyright issues, please contact the author in time, we will deal with as soon as possible.