Trump was elected as a Chinese LED company to open up the prospects of the US market

On November 9, the US presidential election "Tear" battle finally settled, and Trump was the first to get 270 electoral votes, which means he will be the next US president in January 2017. External commentary generally believes that Trump's election will bring more uncertainty to the world. why? Because Trump's eight economic policy propositions will bring many subversive changes to the world economy and policy.

The North American market has always been the focus of China's LED companies. The US Department of Energy report predicts that the overall size of the US lighting market in 2016 will reach $25.1 billion. The US market is the largest overseas market for Chinese companies, comparable to Europe. Among the countries that import LED products in the United States, China's share has reached 70.50%, and the amount is about 420 million US dollars. Two-thirds of the American people have purchased household LED lighting products.

Although the North American market is unprecedentedly attractive, its high entry conditions and technical thresholds have discouraged many Chinese LED companies that want to “nugget” in North America. According to Zhou Zhicheng, general manager of Orije, the United States, as the world's number one economic development body, has a large intelligent lighting capacity, but the development of the North American market is not easy. The US market is regulated by five major institutions, and products need to meet the four major certification requirements. Mr. Zhou Zhicheng said that the United States started in the certification field much earlier than China, and it is much more perfect, and the update is also fast. It will be revised once in two or three years. It is understood that starting from January 1, 2017, North America will implement the New Energy Star standard. The revised ENERGY STAR standard is more stringent in terms of both functional and safety factors.

It can be seen that the development of the North American market is very difficult. This time, Trump won the US presidential election, which has increased the uncertainty of the Chinese LED industry's North American market development work.

First, Trump believes that because China's accession to the WTO has caused more than 50,000 factories in the United States to collapse and more than 10 million workers unemployed, he proposed to declare China a currency manipulator and impose a 45% tariff on all Chinese imports. Once its recommendations are implemented, this is a heavy burden for Chinese companies.

Tariffs can be said to be a major protection measure for the domestic market. Once the Chinese LED companies export products to the United States are forced to impose a 45% tariff, the profit margin of the company's products will be extremely compressed. It is no exaggeration to say that this will directly lose the competitive advantage of Chinese products in terms of price. For the North American market where quality requirements are extremely strict, under the premise of increasing quality standards, China's export of LED products will no longer meet market demand at low prices, which will also lead to Chinese LED products being products of North American companies. Suppressed, even eliminated.

In addition, Trump strongly opposes free trade and claims that this will lead to a retrogression in the US economy. That is to say, after it comes to power, it is highly probable that a series of trade protection measures will be formulated.

The United States is the most important export market for LED lighting products in China. Since the export value of LED lighting products exported to the United States in 2013 ranked first, the US market continued to grow at a high level, with a large total volume, rapid growth rate and abundant product demand. .

According to statistics, China's bulbs exported to the United States increased from US$15 million in 2011 to US$42 million in 2012, US$119 million in 2013, and US$218 million in 2014, accounting for 15.2% of the total. It has grown at a high speed for several consecutive years, of which the growth rate in the first three years is close to 200%.

As a high-tech industry, semiconductors are used in a wide range of applications, including many areas of technology that involve national security. The United States is a country that attaches great importance to national security issues. Previously, the US National Security Council had prevented the Jinsha River from acquiring Dutch Lumleds in the United States on the grounds of "endangering national security." Therefore, the Trump regime is very likely to set relevant trade barriers for the semiconductor industry, which will inevitably weaken China's export status to the United States.

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. China is the world's largest manufacturing country. For the LED industry, Cree, GE Lighting and other companies 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.

From the analysis of Trump's series of economic and policy claims, its "US first" intention is very obvious. That is to say, after its appointment as the forty-fifth president, if its economic policy proposition is realized, the prospects for Chinese LED companies to open up the US market will become “confusing and confusing”.

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