The LED display industry holds significant economic and social potential, prompting governments worldwide to develop strategies and implement supportive policies that drive its rapid growth. However, the government procurement market for LED displays in the first quarter of this year has shown a noticeable slowdown compared to previous periods. This trend raises questions about the future direction of the LED display market.
After experiencing a surge in demand during the second half of last year, the first quarter of 2023 saw a marked decline in government-led procurement activity. According to data released by the Ministry of Finance through media outlets such as "China Financial News" and "China Government Procurement News," the total value of LED display procurements in the first quarter reached 40.5 million yuan, down 23% from 52.59 million yuan in the same period last year. January's procurement dropped significantly to 11.6 million yuan, compared to 21.24 million yuan in January 2022, while February remained relatively stable at 13.02 million yuan versus 12.85 million yuan. March saw a smaller drop, with 15.88 million yuan compared to 18.5 million yuan in March 2022.
Industry experts suggest that this dip is not due to declining demand but rather seasonal fluctuations. The market remains on an upward trajectory, driven by national energy-saving policies and the ongoing implementation of the 12th Five-Year Plan. As these initiatives gain momentum, the LED display market is expected to experience a significant boom in the coming years.
Despite the overall slowdown, the first quarter still revealed promising opportunities. Nearly 60 public bidding projects were announced, with several top projects exceeding one million yuan in value. Notably, two major projects in Fujian—Fujian Xiapu Grand Theater stage LED screen and a procurement project by Jinfeng Tendering Agency—were among the largest, valued at 7.4 million and 6.17 million yuan respectively.
Sports venues, performance groups, schools, and hospitals continue to be the primary drivers of LED display procurement. In the first quarter, venues and performance groups accounted for 28% of total purchases, amounting to 11.49 million yuan, while schools contributed 22%, totaling 8.88 million yuan. Hospitals also showed interest, though the individual project values were generally lower.
Full-color displays dominated the procurement landscape, especially for outdoor applications. Excluding projects with unclear specifications, full-color displays accounted for 6.57 million yuan in purchases, while two-color and monochrome displays made up smaller shares.
Fujian Province led the country in LED display procurement, with a total of 17.04 million yuan in the first quarter—nearly double that of other provinces. This was largely due to two large-scale projects, which helped solidify Fujian’s position as a leader in the market.
Other provinces, including Beijing, Zhejiang, Hubei, Jiangsu, and Shandong, also showed strong performance, with procurement amounts ranging from 1.69 million to 3.57 million yuan. Meanwhile, many other regions reported relatively low procurement volumes.
Looking ahead, intelligence and remote monitoring are expected to become key trends in the LED display industry. While current demand may be nearing saturation, emerging technologies and new application areas will open up fresh opportunities. However, increased competition will also lead to industry consolidation, with smaller manufacturers likely to be phased out.
Currently, the domestic LED display market is still in the early stages of product-based competition, with price, quality, delivery time, and after-sales service being the main differentiators. Price has become the dominant factor, with LED display prices dropping by 15-20% year-on-year in 2022. This decline was driven by larger manufacturers aiming to eliminate weaker competitors through price wars, leading to instability in the market.
As the industry moves toward integration, only those with strong technical and financial capabilities will thrive. Over the next few years, the market concentration is expected to increase rapidly, with larger players leveraging capital and technology to expand their market share.
In the long term, the domestic LED display market will continue to grow, fueled by the replacement of traditional signage and the rise of high-definition, 3D, intelligent, and multi-functional LED displays. With proper regulation and continuous innovation, manufacturers can strengthen their competitive edge and secure a strong position in the evolving market.
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