However, Chinese manufacturers aren’t the only ones investing in LED chip production. Osram announced in November that its new LED chip factory in Kulim, Malaysia has started operation on time. In addition, Osram said the production systems for 6-inch wafers at the new facility produce 125 percent more LED chips per wafer in a single cycle. The factory can be expanded in two additional stages.
Osram also has started production capacity expansion at its facilities in Regensburg, Germany and Wuxi, China.
During an earnings call in July, Olaf Berlien, chief executive officer for Osram Licht AG predicted a “balanced situation in 2017,” but he also noted the possibility of allocation in 2019 because of high demand for LEDs and many of the older 2-inch and 4-inch MOCVD equipment, particularly in China, are being retired this year.