Wu Zongxian, Jay Chou confidently declared to be the LED industry
According to Taiwanese media reports, Wu Zongxian’s LED business had a shortage of funds, which caused him to sell the only single-family castle villa mansion in Yicui Villa for more than NT$400 million and move it to a leased building. . Three years ago, when Wu Zongxian, who had just become the chairman of ASL, a listed printed circuit board company, declared with confidence that he would be Jay Chou in the LED industry. He also said that he would use a low-price strategy to eat a piece of cake in the LED industry.
In the eyes of Wu back then, making LEDs is much simpler than hosting. Now it seems that the LED industry is not as simple as he thought.
Speculators circled money and landed, price war disrupted normal order
The current LED industry has low thresholds, disorderly standards, and companies flocking in, resulting in chaos in the industry. It also increases corporate speculation, and there are many ways to speculate.
And some speculators with money and capital can say that the motivation for doing this business is not pure, that is, they are optimistic about the funds and land provided by the government; it is reported that some local governments not only give land use rights, but also return land ownership. Enterprises can directly use land as mortgage to go to the bank for loans. Then use these loans to invest in a new round of capacity expansion. After the explosive development of the entire LED industry chain in the past two years, it has now shown a trend of overcapacity. In the financial statements of related listed companies, gross profit margins have fallen and performance growth has declined. It is intriguing that, while a large number of new shares broke, the enthusiasm for IPOs of many led companies has not weakened in the slightest. Leyard, Yuanfang Optoelectronics, Jufei Optoelectronics, Changfang Lighting, and a large number of new LED shares will enter the IPO stage one after another. This can't help people ask whether the new LED stocks that have been listed together bring pie or trap to investors?
Some small factories with no money or capital, no fixed market, no strict quality control, no investment in management costs, no investment in R&D costs, and finally get an order, if you can earn a little, you can earn a little more. As for product quality, after-sales service, and a series of factors that may affect the company's sustainable development, they are not within their consideration. We can only rely on low-quality and low-price competition to gain market share. Such a low price will have a considerable impact on the market. At the same time, it will also make normal production companies difficult, because if you follow the speculators to lower prices, it means The loss of profits, and if it is not followed down, it may mean the loss of the market. However, the products they produce have one advantage. They are very cheap. As consumers, in the face of two products that look the same, most of them will choose the low-priced ones, and the low-priced ones may have quality defects or be inferior. it is good. This not only destroys the reputation of the domestic LED industry, but also leaves a very bad impression on my country's LED industry internationally.
