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New LED entrants in China to boost 2012 outlook


IMS Research has lowered its 2011 gallium nitride MOCVD forecast by 24% to 833 reactors,which still represents 4% growth over 2011. In 2012,China is expected to continue to dominate the market for GaN MOCVD tools,market, but shrink to 61% in Q4’12 as Taiwan and Korea rebound.


IMS RESEARCH has released the MOCVD chapters of its 300-page “Quarterly LED Supply and Demand Report” which reveals significant shifts in MOCVD adoption for LED manufacturing.


In June, the previous quarter’s report lowered the annual GaN LED revenue growth forecast to just 4% to $8.7B on rapid 1H’11 ASP reductions from a rising surplus, slower LCD and LED panel growth and the lighting market not yet cost competitive.


With growth slowing, margins shrinking, the oversupply worsening and credit in China tighter than expected, LED manufacturers have pushed out a significant number of installations in 2011 resulting in a surprisingly large MOCVD shipment downgrade.


IMS Research has lowered its 2011 GaN MOCVD forecast by 24% to 833 reactors, which still represents 4% growth over 2011 as shown below. Smaller capacity growth should slow down the LED oversupply and stabilise pricing which will benefit near term LED manufacturer profitability and eventually lead to more tool sales resulting in an upgrade to the 2012 outlook.


Looking to 2012, the 2011 delays along with 13 new entrants in China taking tools should result in a healthy 2012 GaN MOCVD market of 569 tools, down 36% vs. 2011, but higher than previously expected. Tool shipments are forecasted quarterly and identified by customer and wafer size.


These new entrants are a key reason for the growth with these companies


accounting for 110 tools in 2012. Slower price reductions from a smaller surplus should boost the


2012 GaN LED market to $10B, up 15% with


packaged LEDs for lighting up 35% to $2.3B.


China is expected to continue to dominate the market for GaN MOCVD tools, market, but shrink to 61% in Q4’12 as Taiwan and Korea rebound. Epistar is expected to be the #1 MOCVD customer in 2012 followed by San’an, GCL Opto, SemiLEDs and Genesis Photonics. The report also identifies two Chinese MOCVD


12 www.compoundsemiconductor.net August / September 2011


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