Driven by new applications and supports from goverment, the Chinese LED market in 2011 will increase to 58 billion U.S. dollars from last year's 47 billion dollars,which is up about 23%.
As more widely used in LCD TVs and street lighting, LED has become a popular Chinese-made products as well as attractive investment area. In addition, the government's support of the industry seems to have an effect. Chinese LED market is expected to reach $ 6.9 billion  next year and reach $ 11.1 billion  in 2015 ,the compound annual growth rate is 17.7% from 2010 to 2015.Chinese LED markets cover a variety of applications, including LED displays, traffic lights, car lights, LCD backlighting, keypad, digital camera flash, decorative lighting, street lights and general lighting.Street lights will be the largest application area, this year it will reach $ 1.5 billion and reach $ 1.8 billion in 2012 . As the large-size LCD TVs and notebook computers use LED, LCD backlighting market will usher in strong growth, in 2015 annual sales will increase to $ 1.8 billion from $ 713 million this year.
From medium and long term, a factor driving the growth of the LED industry is general lighting market. In view of trend of reducing carbon emissions, the Chinese general demand for LED lighting will be very strong. LED is of low power consumption, and environmental protection. According to the data from IHSiSuppli, the shipment of LED will account for 15.5% of the overall LED market.
Although the LED is relatively prosperous in China, but compared to the United States and Taiwan, mainland China's LED industry is still in its early stages. China is lagging behind in the field which is because of the lack of technical skills,experienced managers and R & D engineers. In addition, China and other core aspects of the LED wafer and the lack of upstream intellectual property rights are also serious problems.
However, the Chinese LED manufacturers can get funding from the local and central governments, which will help domestic enterprises occupy most of the Chinese LED market. So far, the local government provide at least 70% of the subsidies for the purchase of MOCVD equipment , subsidies for each machine is equivalent to 1.5 million U.S. dollars. In addition, the government also provides tax and utility incentives to encourage businesses to invest in the domestic LED industry, which is also very attractive to local businesses.