IHS Forecasts Machine Shipments Will Rise Despite LED ‘Oversupply’

Market research firm IHS predicts that sales for MOCVD equipment will
increase 17 percent, to 221 machines, in 2013, despite an expected
surplus of LED die exceeding demand by 69%. IHS asserts that due to government
incentives and optimism about a lighting business boom, suppliers are
increasing their capital spending and production in the midst of this surplus. Alice
Tao, senior analyst, LEDs and Lighting for IHS, says that this will be the first
annual growth for the MOCVD market since 2011 and will be a major turnaround
from the 70 percent drop in 2012, bringing unit shipments up to about the 2009 levels (click for larger images). Factory utilization
rates are also increasing for major LED companies in Asia, IHS says. In South
Korea, IHS noted for example, that utilization rose up from 60% in 2012 to
about 75 percent in the second quarter. Meanwhile, utilization for some
Taiwanese and Chinese companies reached 90 percent in the second quarter.

This glut of supply reportedly began in 2010. IHS says that in 2010 and 2011
LED suppliers made major investments in MOCVD systems for capacity expansion
with help from China