When the Overseas LED Display Market Will Recover?

According to customs statistics, in the first 11 months of this year, the total value of my country's foreign trade imports and exports was 29.04 trillion RMB, a year-on-year increase of 1.8%. In November, my country’s total import and export value was 3.09 trillion RMB, a year-on-year increase of 7.8%. Among them, exports were 1.8 trillion RMB, a year-on-year increase of 14.9%; imports were 1.29 trillion RMB, a year-on-year decrease of 0.8%. According to Li Kuiwen, Director of the Statistics and Analysis Department of the General Administration of Customs, since this year, the COVID-19 epidemic has ravaged the world and the world economy has been in a severe recession. However, our country has achieved major strategic results in coordinating epidemic prevention and control and economic and social development, and foreign trade policies and measures are effective and effective. Imports and exports have achieved positive growth for six consecutive months since June, and the international market share has further increased. The overall export data is positive. When will the overseas led display market recover?

1. Close regional cooperation and diversified trading partners

Customs statistics show that in the first 11 months of this year, our country's imports and exports with major trading partners have maintained growth, and a foreign trade system with close regional cooperation and diversified trade is being formed. In the first 11 months of this year, our country’s imports and exports to ASEAN, the EU, the United States, Japan, and South Korea were 4.24 trillion RMB, 4.05 trillion RMB, 3.65 trillion RMB, 2 trillion RMB, and 1.8 trillion RMB respectively, an increase of 6.7%. 4.7%, 6.9%, 1.4%, 0.9%, of which ASEAN is my country’s largest trading partner, accounting for 14.6% of my country’s total foreign trade value.

Our country's imports and exports with major trading partners and countries along the “Belt and Road” have maintained growth, the international market layout has continued to be optimized, the opening up has been continuously expanded, the circle of friends in economic and trade cooperation has been maintained and expanded, and the multilateral, bilateral and regional cooperation has achieved fruitful results. In November of this year, the "Regional Comprehensive Economic Partnership Agreement" (RCEP) was successfully signed, marking the official birth of the free trade zone with the largest participating population, the most diverse membership structure, and the greatest development potential in the world. This also gives domestic led display related companies In the development of Southeast Asia and the post-epidemic era, led screen manufacturers have created good conditions for developing the regional market.

As countries and regions along the “Belt and Road” and RCEP, Southeast Asia is currently the world’s most stable emerging market, and it is also a region with a faster recovery rate during the global epidemic. The consumption upgrades in recent years have made the led industry appear in this region. Trends such as chain integration and mid-to-high-end applications have paved a solid path for Chinese led display related companies to explore overseas markets in the next few years. The reduction of customs thresholds in Southeast Asian countries will help led companies reduce the cost of market development. On the one hand, it is beneficial for led companies to vigorously develop the Southeast Asian market.

2. Independent innovation of enterprises, brand competition for small pixel pitch led display products is still fierce

Relevant data shows that thanks to the rapid recovery of the Chinese market, although the global led display market still has a decline of 23.3% year-on-year, it finally achieved a month-on-month increase of 21.3%. According to the General Administration of Customs, our country’s foreign trade and domestic The growth momentum has continued to increase. Private enterprises have increased their independent innovation efforts to continuously increase the added value of their products. While winning competitiveness in the international market, they have also stimulated the growth of my country’s foreign trade exports.

Looking at the entire led display market, it is not difficult to find that despite being trapped by the epidemic in the first half of the year, led display manufacturers adjusted their products and market strategies in a timely manner, actively expanded sales channels, and developed new vertical markets and application scenarios. The shipment volume of small pixel pitch led screen products continues to grow on a quarterly level. Among them, the domestic market has strong demand in government departments at all levels of command rooms, office collaboration, 8K ultra-high-definition video signal broadcasting, and medical scenarios. Industry insiders believe that this trend will be further developed after the full recovery of markets in Europe, Asia Pacific, and the Middle East.

The sluggish global market demand has prompted Chinese brands to focus more on the domestic market, leading to more intense price competition in the domestic market. The first-tier brands that were originally positioned as high-end brands are striving to expand sales channels in second- and third-tier cities, lowering retail prices, and trying to make up for the lack of overseas markets with domestic ones. This makes it difficult for China's second-tier brands and small and medium-sized manufacturers to continue, and they have to choose to change their business direction or close their led display and related businesses.

The market share of first-tier brands continues to increase. At the same time, security companies and traditional lcd brands with strong financial support, including Hikvision, Dahua, Changhong, Skyworth and Hisense, are also developing rapidly in the led display industry. Next, if outdoor large-scale events and gathering activities such as sports competitions are further postponed and the demand for larger pixel pitch displays and rental markets continues to weaken, then the market share of Chinese second-tier brands will further decline in the next few quarters . Although the export of the led display industry showed signs of recovery in the second half of the year, many companies did not escape the depression in the first half of the year. As the led industry fluctuates, the phenomenon of secondary differentiation has become more prominent. This wave of epidemic has accelerated the pace of the domestic led industry into a highly mature period, and the trend of intensive industry integration has clearly become a new trend.

In summary, from the data point of view, overall my country's foreign trade growth in the first 11 months of this year has bucked the trend, with good momentum and full resilience. Affected by the epidemic this year, in the context of a sharp decline in global trade, China’s foreign trade imports and exports have seen a trend of growth against the trend. The small pixel pitch led display continues to grow, and the demand for both domestic and overseas markets is very strong. After the epidemic in overseas markets is effectively controlled, led display manufacturers can be optimistic about the overall economic and market prospects next year. However, the recovery of overseas markets is long, and competition in the domestic market is becoming increasingly fierce. They must be psychologically prepared for opportunities and challenges to coexist.