"Understanding this market, we can better enter this market." Nie Pengxiang, chairman of the incentive test, once pointed out that the market he said refers to the US market.
It is undeniable that the North American market has always been the gold-clad place for Chinese LED companies. The US market is the largest overseas market for Chinese companies, comparable to Europe.
According to the US Department of Energy report, the overall size of the US lighting market will reach US$25.1 billion in 2016, while China’s imports of LED products account for 70.50% of China’s total, which is about US$420 million, two-thirds. The American public has purchased home LED lighting products.
Just in November of this year, the first real estate tycoon with no political experience, billionaires, and the entertainment industry's famous mouth--Donald Trump was elected the 58th president of the United States, which caused a lot of sensation in the world. External commentary generally believes that Trump's election will bring more uncertainty to the world, because its eight economic policy propositions will bring many subversive changes to the world economy and policy.
On January 5-6, 2017, the 2016 Gaogong LED Annual Meeting and Golden Globe Awards Ceremony with the theme of “Looking for the Future of LEDs†will be held in Shenzhen. In the closing ceremony of Mulinsen's title, "The Future of LEDs", Nie Pengxiang, who lives in the United States, will interpret the theme of "The Trump Trade Policy's Deep Impact on LED Exports to North America".
In fact, in his attitude toward China, Trump has repeatedly criticized China on trade issues during the election campaign, saying that "China takes the United States as a piggy bank" and "robs the United States of America." Earlier, it was announced that it would restart trade negotiations with China after coming to power, and even threatened to increase tariffs by 45%, which may have an adverse impact on China's export industry.
In addition, Trump will allow companies to bring back funds that are stranded overseas to the United States and pay taxes at a 10% rate. That is to say, under the Trump policy, the processing industry of American companies may be transferred to the United States.
As we all know, China is the world's largest manufacturing country. As far as the LED industry is concerned, companies such as Cree and GE Lighting have production bases in China. Once the US LED companies shift the production and processing industries to the US, it will directly lead to an increase in China's unemployment rate, and will further intensify the competition between Chinese LED companies and US LED companies in the North American market.
In fact, the high entry conditions and technical thresholds in the United States have made many LED companies in China want to be “nugged†in North America. This time Trump won the US presidential election, which opened up the North American market for Chinese LED companies. Work has increased the difficulty.
In this regard, after Trump was elected, Nie Pengxiang has already shared some judgments and ideas, mainly reflected in the following six aspects:
1. As a result of stimulating the economy and tax reduction policies, the infrastructure will increase substantially. The renewal rate of the old public facilities in the United States will be accelerated. The tax cut will drive the construction of the Private Sector, and the GDP growth rate of the United States will increase. It is doubled on the basis of the current), and the overall demand for lighting products will increase.
2. The finished products of the lamps entering the US market, especially through the C&I (Commercial and Industrial) channel, will increase the threshold for entering government and public projects. The requirements for the government and public projects for Made in USA will be even worse than those for the Obama administration. The ability of lighting manufacturers will directly benefit, and importers may therefore reduce the import of finished products and purchase kits to assemble themselves.
3. The impact of consumer lighting products through the retail channel is limited, but market supervision measures will be strengthened, and various types of sampling and recalls will increase significantly, because this is the best technical barrier to trade, which is easier than direct tax increase. More.
4. Because Sichuan is not very flustered by the Clean Power Plan and the Paris Climate Convention, the subsidy policy of the power company may be revised. At present, the subsidy for the Energy Star and DLC certified products is too artificial, resulting in a relatively large operational difficulty. And unfairness, which will have a direct impact on the manufacturers of the main ESCO direct channel, and more conducive to the Distribution to Contractor channel.
5. The demand for parts and components entering the United States will increase. It is expected that if the tax is actually added, it will only be for the finished product and will not be for the kit.
6. Increased investment opportunities in the United States, and domestic companies with strong strengths can get rid of various uncertainties by acquiring existing companies in the United States and quickly achieving control over the channels to obtain stable returns.
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