Chinese LED companies including chip makers Sanan Optoelectronics and HC Semitek and LED packager MLS reported that they have received subsidies from the government.
Sanan Semiconductor, the subsidiary of Sanan Optoelectronics announced that it has received RMB 200 million (US$28.15 million) from local government based on the agreement of investment collaboration. The company was just granted RMB 143 million (US$ 20.13 million) last week for equipment purchase.
The government of Yiwu, Zhejiang is issuing two subsidies to the second large LED chip maker HC Semitek. The total amount of the subsidies was RMB 36.26 million (US$5.1 million)
LED packager MLS was granted with governmental subsidy, its subsidiary in Jiangxi has received RMB 79 million (US$ 11.12 million) from the government.
Despite the continuously affecting coronavirus epidemic, the Chinese government does not stop its cash support to its domestic business. The government also request manufacturing sites to fully resume work even though many workers still have difficulties returning to their position. In March, the work resumption rate in China was around 50-60%, estimated LEDinside.
With increasing subsidies from the Chinese government and decreasing demands in the end market, oversupply in the LED industry might continue despite the production slowdown.