Philips Lumileds To Establish Automotive LED light Production Line in China

Chinese "One Belt, One Road policies" encouraged Philips Lumileds to establish a new automotive LED light production line.

Lumileds, the former Philips LED component and automotive LED lighting business, was acquired by Chinese investment fund Go Scale Capital on March 31, 2015 for US$ 3.3 billion. Philips expects concluding the sell-off deal by 3Q15.

The introduction of Chinese investors has provided huge development opportunities, said Klemens Brunner, General Manager, Automotive LED Lighting Asia Pacific, Lumileds.

Lumileds new logo.

Chinese "One Belt, One Road" policies have also provided chances for manufacturers to expand in the Asian market.

Chinese "One Belt, One Road" program proposed in late March this year, has expanded the previous development plan of enhancing policy coordination across Asia, financial integration, trade liberalization and people-to-people connectivity, according to Center for Strategic and International Studies (CSIS).

 Lumileds highly values China recent "One Belt, One Road" policy, which potentially could expand the automotive export market, said Brunner. At the same time the "One Belt, One Road" policy will make trading with other Asian nations more convenient, so it will be easier for Lumileds to export its products in the region.

"Lumileds has two large automotive lighting factories in China, and is preparing to establish a new automotive LED light production line," said Brunner. "The products of that company produced in China are currently exported to Asian countries including Indonesia, India, and Thailand."

The global automotive LED lights market value is expected to reach US $2.5 billion by 2018, according to a research analysis. Automotive lighting market in China also has enormous potential. Based on 2013 statistics, the country has more than 270 million motor vehicles, with more than 85 million privately owned automobiles. The country automotive market growth has continued to encourage automotive lighting market demands.

As for Go Scale Capital acquisition of Lumileds, Chinese LED industry insider Bob Lee believes it is a rare opportunity for the local industry. The deal is expected to accelerate the internationalization of LED industry in China, while improving Chinese LED technology and manufacturing capacity, said Lee.