1. Chinese LED manufacturers have poor brand image, and are not recognized in domestic or international markets
A copied product will always just be a replica. Chinese consumers and clients usually think duplicated products are less reliable than the original. International manufacturers have been developing high power ceramic packages for years, and have already built up a reputable brand image among consumers. Chinese LED package manufacturers, even listed companies are almost unknown in the high power lighting industry. Domestic consumers do not recognize their products, so imagine how difficult it will be to sell the products on international markets, such as in U.S. or Europe.
2. Low yield rates caused by immature package technology
This is the hard learned lesson of a ceramic package advocator in China, who has experienced years of hardship. Early ceramic package’s technology adaptors faced a myriad of technology barriers including chip electrode positioning, eutectic bonding, phosphor powder coating, silicon glue molding, chip slicing, optical measurement and other difficult technical procedures. Some of the issues included inaccurate positioning, hollowed out eutectic bonding layer, and cracked chips when under pressure. Other issues also greatly raised reliability risks, and caused high failure rates that continued to bog down manufacturers.
3. Imports lead to high LED chip and substrate costs
Even if manufacturers successfully headhunt talent, it is not equivalent to acquiring the needed services. This has been a hard learned lesson for Chinese manufacturers. Even if Chinese manufacturers successfully headhunt engineers from international manufacturers’ technology team, the new members did not bring with them excellent raw material services. This issue is most evident in LED chip and substrate raw material sources.