Taiwan government plans LED lamp subsidy

A planned subsidy for LED lamps could halve their price for consumers in Taiwan, and should also provide a welcome boost for the local LED industry.
LED manufacturers in Taiwan received a boost last week when government officials announced a subsidy for LED lamps, according to an article on the Focus Taiwan website. The Ministry of Economic Affairs (MOEA) is reportedly thinking of offering a subsidy of NT$200 per lamp.
The Minister of Economic Affairs Shih Yen-shiang said that the NT$1 billion subsidy program to encourage domestic consumers to buy LED lamps would commence in a month’s time.

Households will be able to claim the subsidy of NT$200 per LED lamp for five to ten lamps, said Shih. LED lamps typically cost NT$400-500, so the subsidy could halve the price in some cases.

With rising environmental awareness in Taiwan, analysts say that consumers will be willing to buy LED lamps if the products become more affordable. High prices are thought to be delaying the growth of the LED lighting market.

The subsidy is likely to be good news for the market, although there are worries that consumers will delay purchasing LED lamps until the MOEA launches the subsidy program in a month’s time, says the article.

Several local firms that produce their own brands of LED lamps saw their share price rise following the announcement, including China Electric Manufacturing Co., Delta Electronics Inc. and Everlight Electronics. LED component makers including Formosa Epitaxy and Edison Opto Corp. also saw a positive response.

Epistar predicts industry reshuffle
Meanwhile, Biing-Jye Lee, chairman of Taiwan-based LED chipmaker Epistar, told the Digitimes website that Taiwan-based LED companies have been facing rising competition from their China-based peers. Partly this has been due to the subsidies provided by the Chinese government, for both equipment procurement and plant construction, but these will come to an end in 2014.

Lee said that Taiwan-based LED companies own advanced technology, while Chinese companies have access to a large market. If Taiwan- and China-based LED firms can cooperate in the international LED lighting market, said Lee, then the alliance will be “influential and meaningful.”

Lee also said that Chinese companies have created an over-supply situation, and this has forced prices to fall. However, several LED epitaxial-wafer suppliers in China have already been asked to merge, said Lee, who also predicted that only five large-size LED firms will be left in China by 2015.