Neo-Neon expects LED lighting revenues to increase 40-50% in 2011

Neo-Neon Holdings has started retail sales of its LED lighting products under the own brand Neo-Neon, and expects LED lighting product sales to grow 40-50% on year to account for 60% of its US$300-400 million total revenue target in 2011, according to the company's Taiwan general manager Cheng Chien-wen.

Neo-Neon, which began with conventional lighting products, has since established a vertically integrated LED supply chain from epitaxial wafers and chip packaging to luminaires and sales, Cheng noted. For Taiwan, the company's own-brand LED light bulbs are distributed in home improvement stores and hypermarkets and it will introduce 14 new LED embedded lighting products in December, Cheng said. LED lighting revenues in Taiwan are projected to reach NT$20-30 million in 2011.

The future LED market will be a competition of logistics and cash flow, and business models must accommodate existing distribution channels since it is difficult to change consumer behavior in the short run, Cheng said.

Neo-Neon will focus on the professional DIY do it yourself and residential replacement markets, Cheng indicated. LED lighting still requires more market education as the energy saving benefits cannot be felt right away by consumers, he added.

Neo-Neon branded LED lighting products are currently sold in the US, Europe, China and Hong Kong. Conventional and LED lighting will each represent about half of the company's 2010 revenues.