Green Lighting Casts Promising Ray Upon the Chinese Lighting Industry

It seems that the global recession, despite putting the damper on many other sectors, has given continual impetus to makers of green lighting in China, with such lighting typically defined as ones that conserve energy and cause less pollution. Turning up the brightness on eco-friendly lighting at the trade show recently in Guangzhou, Messe Frankfurt, the show organizer, made green lighting the theme.

Not only bearing green lighting as the theme, the 2009 Guangzhou International Lighting Exhibition, held June 9-12, also placed ample emphasis on what is widely agreed as the lighting format of the future-LED lighting, which occupied the majority of show stands.

Enormous Market

The statistics supplied by the China Illuminating Engineering Society (CIES) confirm the astronomical market of green lighting in China: besides commercial users as hotels and public facilities, households using power-saving lights now number 100 million. The capacity of the Chinese power-saving lighting market tops 12 billion units a year, with the market growing at double-digit rates that is driven by rapid urbanization in recent years.

The Chinese green lighting market has sufficient room to accommodate 20 major brands; but without any Chinese green lighting maker boasting annual turnover exceeding 1 billion RMBs, there still exists no established brand in the market, according to CIES. For example, Guangdong Province has over 3,000 green lighting brands, all of modest scale and selling within the province. Most Chinese lighting makers produce a variety of products for industry, household and public places, rather than invest resources to specialize.

Low Brand Recognition

With the lighting sector occupying only 3-5% share of the Chinese building-materials market, so few lighting makers find justification to invest in steady advertising and promotion; hence brand recognition plays a flickering role, with most consumers trusting advice of storekeepers when purchasing lighting products.

As is often the case globally, major foreign brands as Philips and OSRAM dominate the high-end segment of the Chinese green lighting market, becoming widely chosen by less budget-minded users for outdoor lighting, public facilities, fashion stores, F&B outlets and households, with second-tier or mostly local brands as NVC, TCL, Opple and Pak being popular in city-run markets.

Unlike other lighting products, dealers of green lighting should also provide ample after-sale service to consumers, which is still lacking in most Chinese markets.

The growing awareness of the importance of eco-protection in China has literally shed new light on the minds of Chinese lighting consumers, motivating them to increasingly adopt energy-efficient lighting-upgrading from T12 fluorescent lamp to T10 power-saving lamps to T8-40W and T8-36W-saving some 10% in energy each step.

Benefiting From Subsidy

Benefiting from the Chinese government's effort to promote energy conservation and carbon reduction-a program backed by 370 billion yuan this year as part of the 4 trillion-yuan budget to expand domestic demand-green lighting makers will see higher sales due to subsidized purchase under such program, which follows a similar campaign last year that subsidized 13 makers who sold 60 million power-saving lamps. The subsidies this year will benefit 23 makers to sell 100 million lamps.

Still, the Chinese lighting sector is feeling the brunt of the global recession. For example, lighting makers in Guangdong is suffering export shrinkage this year, seeing substantial decreases in new and long-term orders. Notwithstanding, insiders firmly believe steady development of eco-friendly products in China is still the light at the end of the illumination tunnel for the nation's lighting sector.