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What impact would be brought by Sino-US trade war to LED lighting industry?

Publish Time:2018/09/14 Industry Dynamic View:14

Since April of this year, after United States Trade Representative (USTR) publishing “301 Sanction” bill which is to impose 25% tariff for more than 1300 items of China’s manufacturing products, Sino-US trade war formally entered into tension situation. In July, United States’ government published additional imposing bill, it is forecasted to impose 10% tariff for China’s products whose value is 200 billion dollars. In these two stages of 301 sanction, LED components and products also are included. Currently, bill of the second stage which is to impose tariff for 16 billion of China’s products has already been performed, then what impact would be brought by Sino-US trade war to LED industry?
Sino-US Trade War impacts LED Lighting


In terms of the bill which was valid in July, most of LED products which were impacted are semi-finished products, including silicon circle and backlight product. According to the prior releasing information to analysis, this tariff bill is to impact these United States’ companies which have production capacity in United States, but need import semi-finished products from China.

From the impact effect, as most of LED products which are exported from China are finished products, it is not obvious to influence the price of LED lighting products, thereby, LED analyst pointed out, the market demand of LED lighting is still show-moving, but still didn’t find its price decrease.
Sino-US Trade War impacts LED Lighting


For the second stage of bill whose value is 200 billion dollars, its performing time and details are still not sure, the LED categories which are inside this bill refers to more wide LED products, there are more than ten categories of LED and lighting products in this bill, the exporting value of these lighting products have covered nearly 75% of China’s lighting export, there are above 8 billion dollars LED products to be exported to North American areas. Indeed, United States is the important market of China’s LED lighting export, the Sino-US trade war is inevitable to impact China’s LED industry or United States’ relevant companies.


From current supply chain of LED lighting products, 85% of LED lighting products are manufactured and assembled in China, although there is still production line of LED lighting products outside of China, the production capacity which are outside of China can’t meet United States’ market demand. Therefore, Besides the tariff bill impacts China’s and United States’ companies, if companies improve price because of materials cost increase, United States’ consumers would also confront the situation that the product price is increase.

Sino-US Trade War impacts LED Lighting


In fact, after the twice list being published by United States’ government, it is United States’ companies the first to publish that their operation has been impacted. And China’s companies were looking for strategies, in order to reduce the impact of tariff bill, China’s companies might reduce selling LED products to United States, and improve exporting to the markets outside of United States. Although for the LED assembling factories which have production capacity outside of China, they might get benefits from the order transfer effect which is caused by the tariff bill, but Overall, If China’s companies sell LED products to the market outside of United States as more lower prices, it might lead to prices competition, which is also not good for the companies which are outside of China.

 

Bingsolar, 14th, September, 2018

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