Will the low price lead to product popularity? LED bulb prices suddenly halved
The price competition for bulb-type LED lighting is becoming more and more intense. It is Sharp that ignites the fuse. In June 2009, the new product released by Sharp set the standard price to about half of the original product. The LED Bulb equivalent to a 40W incandescent lamp is priced at about 3,900 yen, which is equivalent to a price of about 4,000 yen for a 60W incandescent lamp. "The life of an incandescent lamp is 1000 hours per 100 yen, and the price of an LED bulb with a life expectancy of 40,000 hours is 4,000 yen" (Sharp). To make the price per unit time the same as incandescent, Sharp managed to cut the cost of LEDs, power components and materials. In line with the policy of “choosing suitable materials inside and outside the company†(Sharp), the LED package of the core components is also externally purchased, rather than self-produced.
The improvement in LED package performance has contributed to the reduction of component costs. The miniaturization and heat dissipation design is easier to implement than before, and it is easier to install in a small space such as a bulb type. However, after the price has been halved, the cost of the parts has not fallen to the point where sufficient profits can be obtained. Sharp's intention is to gain a share of the new market for home LED lighting with this strategic pricing. Market response As Sharp expected, Sharp's new products were popular, and in order to ensure the number of Sharp had to postpone the time to market.
In order to fight against Sharp, competitors have also taken action. Toshiba Lighting Technology added four LED Bulbs with power consumption of 6.9W and 4.1W in July 2009. The overall efficiency of the 昼 white product is 82 lm / W, "the highest in the industry" (Toshiba Lighting). The 6.9W product is priced at 5,460 yen, and the 4.1W product is priced at 5,250 yen, which is about half of the existing product. The actual market price is below 4,000 yen. In April 2009, Ecorica, which had just entered the bulb-type LED market, lowered its product price from 7,200 yen to 3,780 yen three months after the product was launched. Alice Oyama also entered the market at the price of 3,980 yen in mid-June of the same year.
Despite the “very serious situation in terms of cost†(Toshiba Lighting Technology), companies are still expanding their low-price competition because in the market, the predecessor’s view of the king prevailed. LED lighting, which is characterized by long life, will not have much replacement demand after the popularity. The new market has just emerged, and excessive competition has already begun. (Reporter: Yoshida Satoshi)
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