LED Bulb Prices on the Chinese Market Fell the Most in June 2014

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Price falls were most evident in China last quarter, according to latest LED bulb retail price reports by LEDinside, a research division of TrendForce. Globally, the 40W equiv. LED bulbs Average Selling Price (ASP) grew incrementally by 0.9 percent to US $14.4, while ASP for 60W equiv. LED bulbs was slightly down by 0.6% to US $19.4 in June 2014.

Bulb price drops were most evident in China for 40W and 60W equiv. LED bulb products last quarter, having fallen 19.7% and 9.8% respectively, observed LEDinside. Local brands have aggressively slashed prices including Foshan Lighting, and Haide Lighting. Additionally, international brands high priced products have temporarily exited the market due to sales situations, which also caused the lower bulb ASP. In general, prices in China were lowest among major global markets.

Source: LEDinside

There are still obvious price differences between international and local LED bulb brands in China, noted LEDinside. In contrast to international manufacturers low price strategy in U.S. and European market, Philips and Osram LED bulb prices in China are priced above average. “Disadvantages in manufacturing costs and resources also make it more difficult for international brands to compete against Chinese brands,” analyzed LEDinside Analyst Terri Wang. However, local Chinese brands have been unable to gain consumers trust and acceptance because their low price products have less product performance and weaker brand image. Therefore, the LED bulb market penetration rate growth has failed to match the rate of plunging prices.

Global ASP slightly fluctuates in June

ASP of 40W equiv. LED bulbs dropped 5.3% in U.S. during June 2014. Some products already on the market entered sales promotion period, which resulted in large price cuts. For instance GE’s 9W bulb prices were down 30% last month, while Philips 8W dimmable LED bulb prices were also slashed in the same period. No other major price adjustments were made in 40W equiv. LED bulbs ASP in other regions.

ASP plunged the most in Germany having downed 25.4 percent in June 2014. Prices of existing products declined steadily with more evident price adjustments among certain products, for instance LG’s 12.8W bulb price was nearly halved from US $14.8 to US $7.9. Other high priced products were also temporarily exited the market, for instance sales of Osram’s LED bulbs priced above US $30 were halted in June 2014. In contrast, bulb prices in Japan were up 9 percent to US $18.3 during the same period. Prices also fluctuated for existing products in the Japanese market with certain low priced products removed from the market for a limited time period including KEIAN 12W 880lm LED bulb, which is being sold for US $13.8. In addition, fluctuations in currency exchange rates also resulted in rising LED bulb prices in Japan.