LED companies fall into the "quality door" OEMs become scapegoats

From the “Ten Cities and Ten Thousand Miles” to “Energy Saving and Benefiting People”, the central and local governments have given various support policies and support funds to the LED industry. However, LED products have repeatedly exposed quality problems and have made this lighting industry’s darlings Doubt, especially some international first-line brands have also lost the "quality door" incident.

Random inspection of 70% of unqualified international giants also on the list

In August last year, the Guangdong Provincial Bureau of Quality and Technical Supervision released the results of provincial-level special supervision and inspection of the quality of self-ballasted LED lamps in Guangdong Province. The sampling results showed that in the batch of 23 batches of self-ballasted LEDs, 17 batches were rejected, and the failure rate was as high as 73.9%.

The spot check involved self-ballasted LED lights produced by 21 companies in 7 cities in Guangdong Province. Unqualified items involve accidental contact with live parts, insulation resistance and dielectric strength after wet treatment, mechanical strength, fault condition, chromaticity tolerance, general color rendering index, disturbance voltage, lamp power, heat resistance, interchangeability Sex, power factor, initial efficacy / luminous flux, fire and fire protection.

Coincidentally, just one month before, the Shanghai Administration for Industry and Commerce conducted quality monitoring on the sale of movable general-purpose lamps in the market. After testing, 13 batches of goods were unqualified, among which well-known brands such as Osram and Opp also appeared. On the blacklist. According to the Shanghai Administration for Industry and Commerce, this time, the quality of various portable general-purpose lamps of different light source types such as incandescent lamps and fluorescent lamps is monitored. The problems of unqualified products are mainly concentrated on the insertion loss/harassment voltage. Aspects. In fact, Osram and Opp have passed the "blacklist" of unqualified quality inspections in September 2011.

After the monitoring results were released, Gong Xiaozhi, secretary-general of the Shanghai Lighting Industry Association, told the media that the incident exposed the problems of lighting companies' lack of strictness. The lighting industry is outsourcing production in large quantities, and this time multiple batches of products have problems or are related to this.

The problem of multiple batches of products in the lighting industry has been detected, and the phenomenon of highly OEM in this industry has surfaced.

Zibo said that the lighting industry's OEM phenomenon is very serious, including many large brand companies are taking a large number of foundries. According to an expert from the China Lighting Society: "For example, Philips, the world's largest manufacturer of lighting appliances, has a very high proportion of lighting products. In addition, OSRAM and NVC lighting also have foundry. Some big brands such as Philips, Osram and other OEMs are close to 90%.” Zhang Shanduan, deputy director of the Institute of Electric Light Sources at Fudan University, told reporters that the OEM itself is not wrong. Due to the large outsourcing of the business, the company’s control over its foundry is somewhat “unmatched”. The quality of the products produced is not well controlled. Coupled with the fierce competition in the industry, the industry's costs are on the rise, raw material prices are rising, and the economic downturn and industry competition have depressed market prices. At the same time, the compression of industry profits will also allow companies to reduce costs and ease supervision, resulting in quality problems.

Zibo believes that the OEM OEM model should be a win-win situation for both partners - the international giant's brand technology advantage combined with the cost control of domestic enterprises and the advantages of cheap labor, but now it has become a double loss - The lighting giant has smashed its signature, the domestic enterprise technology has not been upgraded and it has become a wage earner for several processing costs.

The "bottom" fate of the foundry
At present, in the globalization system, European, American, Japanese and Korean companies occupy a key position in the global industrial division of labor. Other regions are at the low-end of the industrial chain, and more participate in globalization in the form of foundry.

Zibo told reporters that in the current global division of labor in the LED industry, the United States, Europe and Japan are still in the upper reaches of the industry, mastering key technologies. US Cree, Germany Osram masters the core technology of LED chips; LED crystals provided by Japan Nichia and Toyota Synthetics are considered to be the best at present, and the two LED die production capacity accounts for about 80% of Japan's total production.

The huge market potential has made the LED industry once an investment “blue ocean”. However, due to the lack of upstream core technologies and equipment, most domestic LED companies can only get together in the middle and lower reaches of the investment threshold.

The advantage of the foundry model is that, in addition to reducing production costs, it can also rationally utilize idle capacity and reduce the company's repeated investment in production. In addition to having the world's most recognized potential lighting market, China also has a cheaper global labor market. Therefore, many international lighting brands have chosen China as their main foundry base.

At the same time, Europe, the United States, and Japan all have a set of strict control over the management of the foundry, and the general large companies will send a foundry inquiry to the foundry. In this document, the brand, quality and quantity of the raw materials have been specified, and the related logistics, maintenance, training, employment and other expenses are also clearly and clearly calculated. Customers pay only to the foundry companies at a higher labor cost. In short, LED package foundry companies earn the difference in labor costs.

In addition, LED midstream packaging technology is basically in the hands of companies in mainland China and Taiwan. Domestic LED packaging export enterprises basically do OEM for European and American companies, but in the context of globalization, the survival environment of foundry companies is also the most difficult. As labor costs increase, the profit of LED packaging foundry companies is significantly reduced. The lower the profit, the more it needs to maintain profitability. Therefore, it can only expand production capacity and recruit more employees. This kind of business strategy based on human tactics alone will be steadily pushed by rising prices, labor costs and exchange rate fluctuations.

The foundry cannot be a "scapegoat"

Liu Muqing, director of the Department of Light Sources and Lighting Engineering of Fudan University, told reporters that because the industry is generally preoccupied with the concept of foundry, when brand products are in trouble, everyone first thinks that the problem lies in the foundry, or even The company needs to make any explanations.

"OEMs should not be a scapegoat for brand problems in brand enterprises." Zibo believes that brand companies are caught in the "quality door", and the brand companies in the raw materials, production processes, inspection processes, and even the choice of foundry partners, There is a considerable correlation, and brand companies cannot push away the responsibilities they have to bear.

Liu Muqing believes that brand enterprises are caught in the "quality door", and the core problem lies in the lack of corporate responsibility. Enterprises need to be responsible for their own responsibility and responsible for their customers and to make high-quality products. This requires that the enterprise needs to establish a sound quality control system; and the government, it is necessary to introduce a corresponding accountability system to enhance the responsibility of lighting companies.

"OEM is an important survival method for small and medium-sized lighting enterprises in China. Now, there will be a long-term existence in the future." But Zibo also believes that if the morbid phenomena in the current lighting foundry industry cannot be fundamentally reversed, the "Quality Gate" event There will be an endless stream, and the entire LED lighting industry will be destroyed.

(This article is reproduced on the Internet. The texts and opinions expressed in this article have not been confirmed by this site, nor do they represent the position of Gaogong LED. Readers need to verify the relevant content by themselves.)

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