Manufacturing Snapshot: LED Packages

CEMAC provides deep analysis to help policymakers and industry gain deeper understanding of the state of and opportunity space in manufacturing of LED packages and other clean energy technologies. These high-level insights are drawn from Benchmarks of Global Clean Energy Manufacturing.

The manufacturing supply chain for LED packages

• Global revenue from LED lighting systems is expected to total 216 billion USD between 2015 and 2024.
• Value added from the production of LED packages was 8.6 billion USD in 2014. Of the technologies covered in Benchmarks of Global Clean Energy Manufacturing, LEDs are the only one to show higher direct value added than indirect.
• The global market for LED packages used in luminaires is estimated at 7.9 billion USD. Demand for LED luminaires, and thus for LED packages used in luminaires, is driven by policy (regulated phase outs of incandescent lighting) and market forces (decline in LED luminaire prices).
• LED package production is concentrated in Japan and South Korea, which together constituted over 55% of total global package output. China and Taiwan are also significant producers, together comprising another 25% of total global production.
• Between 2015 and 2016, the market entered a period of severe oversupply, with resultant price pressure driving average selling prices down by 30%–40%. Consolidation among manufacturers is ongoing and expected to continue.