How the Laser Market in Southern China was Developed?
Guangdong province, a pioneer in Reform and Opening-up, has gradually rooted its development in manufacturing and registered rapid economic growth in the past four decades. Huge market potential for laser application is to be unlocked in Guangdong, which is not only powered by high demand for new technologies with complete industrial chains already in place, but also facilitated by its current position in a key stage of automation and intelligence upon achieved upgrading and transformation from conventional to smart manufacturing. And the development of laser industry is due to the following aspects.
Leading the Industry with Advanced Concept of Guangdong Optics Valley
Booming laser industry in Guangdong is partially explained by support of policies on science and technology and governmental funds. But what matters more is the visionary Grand Concept of Guangdong Optics Valley proposed by leaders from provincial party committee to take a lead of this industry. Early in the middle of November 1999, the first International Consultative Conference on the Future Economic Development of Guangdong Province was held during which the concept of Guangdong Optics Valley was first initiated by the Vice President of Lucent Technologies who was also a consultant to the provincial Governor. Based on this concept which was accepted by the provincial government swiftly and happily, the Guangdong Optics Valley was to be built with Guangzhou as its center.
In January 2000, a leading group under the leadership of Zhong Qiquan, the Deputy Governor and a task group led by Zhang Guangning, Deputy Mayor of Guangzhou were established, followed by a joint working group combining many departments including the Information Center in Guangzhou. It invited and coordinated professors and experts specializing in regional development to roll out plans. Decisions have been made to create a beneficiary environment for investment and entrepreneurship where resources and factors could be pulled together such as education, scientific and technological research, talents, capital and market to launch a batch of market-oriented optoelectronic projects centering on commercialization and girt by both R&D and talents in an area where the Guangzhou Science and Technology City is a base and the Pearl River Delta is the backland. It is committed to putting into place a belt of fast-growing optoelectronic industry by constructing a technology system for photoelectronic industry integrating R&D, talent nurturing, manufacturing and marketing.
Laser industry in Guangdong enjoyed a peak since the year before last when the Science and Technology Department at provincial level introduced a Special Major Project List for Science and Technology Development in Laser and Additional Materials. In 2020, it issued Suggestion on Nurturing and Development Clusters for Strategic Pillar Industries and Strategic Emerging Industries as a sign of devoting all its effort into industrial advancement.
A series of arrangements in Guangdong province concerning the fabric of optical discipline, strategic industrial options and supporting policies have followed this major guidance, constituting a boost to optoelectronic industrial development and rapid growth of other sectors. Optical industry in Guangdong is in full swing, enjoying a roaring growth.
Hubei Merchants in Search of Market Opportunities in Southern China
Technology application in Southern China is driven by the market, that is to say the development of new processes and products always responds to users’ requirements, so the products are more acceptable to the market. Guangdong’s shortage in R&D capabilities of laser technology comparing to Wuhan could be compensated by its large scale of manufacturing that catapulted it into the largest electronic manufacturing basis globally. Apart from that, industries of leather, mold, ironware, plastics, kitchenware, home appliances, petrochemicals, food and drugs, and automobile have achieved quite a market size. Guangdong has topped other regions as the fastest-growing laser market in China and has so far been crowned as the biggest laser application market in China. In the past 2 decades, OEM of high technology has been in a robust shape despite transformation towards high-tech industry in Shenzhen, Guangzhou, Dongguan and Foshan and the proper case in example is Foxconn, the largest OEM across the world. What has elevated this place into the largest laser application market in China is the sizable OEM industrial room and demand for laser processing in Shenzhen or even across Guangdong province. Businesses outside this region awaking to the prominence of Southern China market, rush to set a foothold here.
After more than 3 decades’ development since its foundation in 1988, Wuhan Optics Valley also known as Wuhan East Lake High-Tech Development Zone has a fully established national base for the cooperation between industries, universities and research institutes in sectors of laser processing and commercialization. It is pillared by the industrialization base, the Wuhan National Laboratory for Optoelectronics (source of technological innovation) and the National Engineering Research Center for Laser Processing (innovation base for engineering). In terms of R&D and innovation, its high-end equipment made an earlier start and is of excellent quality superior to that in Guangdong. In addition, the high concentration of laser businesses also blessed it with more attention. However, advantages in talents and research achievements enjoyed by Wuhan, the cradle, trailblazer and vanguard in laser technology in China, are offset by its lacking in application comparing to the Yangtze River Delta and the Pearl River Delta, just as described by the proverb that full preparation comes down to nothing if you arrive after market is closed. In pursuit of development and sales market expansion, many laser companies have marched southward to base their subsidiaries or POS in Guangdong, known as the Business Camp from Chu (nickname for Hubei). Here comes a layout of Wuhan R&D and Guangdong marketing. To some extent, this is a stepping stone for clustered development of laser industry in Guangdong.
The Base Camp of Laser in the Pearl River Delta
Guangdong’s late start morphing into advantages in laser industry is because of its inherent upper hand that local companies have undertaken OEM orders from all over the world in the early time of Reform and Opening-up. As a result of adapting itself to laser industry and application, it produces a large proportion of industrial values for laser processing and products. It is a result of preponderant geological location and market-based resource allocation. Laser companies are concentrated in Guangzhou, Shenzhen, Dongguan, Foshan and other places within the Pearl River Delta, adjacent to Hong Kong and Macau, with advanced shipping conditions for convenient export. Export of laser industry in the Pearl River Delta accounts for more than one third of the national laser product export.
Shenzhen has now become the NO.2 cluster for laser industry in China, second only to Wuhan. Laser companies located in Shenzhen are mainly concentrated in three districts of Nanshan, Baoan and Longgang, reprensented by Han's Laser, Sunshine Laser, United Winner, TETE Laser, Musen Tek, MAX Photonics, Hymson Laser, Bodor Laser, DNE Laser, RFH Laser, GOAL Technology, East Winner Laser, Laservall, JPT, GD Laser, Min Sheng Laser, Lian Pin Super Laser, Da Peng Laser, Hailei Laser, Lei Feng Laser and LASERVALL (Shenzhen, CHINA) Co., Ltd.. Exported abundant operators and technicians trained by the Shenzhen University, Guangzhou City Polytechnic and Shenzhen Institute of Technology to businesses are warmly welcomed as fresh blood injected in case of talents deficiency so that businesses could focus their energy on R&D, which is beneficial to industrial development.
As industrial transformation and upgrading in Guangdong has driven the application of new process, the market potential is quite large for laser. Guangdong is now the home to over 250 laser companies whose output exceeds 10 million. In 2019, laser industrial value registered about 35 billion, taking 34% of national total output, an increase of 2 percentage points comparing to 2018. This achievement is obtained mainly because of big jumps in business performance for companies like Sunshine Laser, Hymson Laser, United Winner, MAX Photonics, HSG Laser, Strong Laser and DNE Laser. Taking the first place in the ranking of laser application market with a 40% of national share, the Pearl River Delta has earned the name of the Base Camp for laser industry in Guangdong province.
Shenzhen has Become the Largest Cluster for Laser Industry in China
Agglomeration effect is now gradually revealed for the laser industry in Shenzhen, the top 1 laser cluster in China with hundreds of companies at an industrial scale of more than 20 billion RMB. Capable companies in Shenzhen such as Foxconn, BYD, Huawei and ZTE, together with many companies in sectors of electronics manufacturing and metal molds have adopted laser processing, making a great contribution to creating advanced manufacturing in Shenzhen and high value-added industries. Han's Laser registered 9.56 billion RMB for business revenue in 2019, down by 13.3% on year-on-year basis. Sunshine Laser, a public company, realized 790 million RMB for business revenue from January to December of 2019 with an increase of 36.2% and 72.08 million RMB were recorded as net profit for shareholders, up by 5.65% year on year. United Winner and MAX Photonics together hit the mark of 1 billion RMB. A batch of laser companies whose market value is within the range of 100 to 500 million RMB are cropping up in Pengcheng. This unstoppable force of private sector is propelling the growth of laser industry in Guangdong. It is in 2014 that Shenzhen surpassed Wuhan to become the largest city for laser industry in China. In 2019, its industrial value exceeded 26 billion RMB, taking the lead in Guangdong province and accounting for as high as 27% in national output.
Given the greater cost-effectiveness in the application of laser technology in contrast to many conventional manufacturing technologies, it is now omnipresent across industrial application. Considering the continuous emergence of novel laser technologies among which super-fast laser machines are on the trend of assuming industrial purposes, the market is bound to be kicked off. Riding the wave of improved automation, integration and intelligence for laser processing, the applicability and application domains for laser technology keep pushing forward frontiers when combined with industrial robots to achieve multi-dimensional processing such as 3D welding, marking and cutting. Laser industry will bath in bonus thanks to the development of intelligent industry and Made in China 2025. And the next two decades are golden era for laser technology. The value of laser industry in Guangdong in 2020 is forecast to exceed 36 billion RMB, driving more than 600 billion of added-value for related industrial chains. Laser processing technology will be further promoted in manufacturing throughout the whole province.
Source: Laser Fair