The impact of US trade war on China’s lighting industry

The impact of US trade war on China’s lighting industry

After the US government’s 25% sanctioned tariff on China’s $34 billion imported products on July 6th, the Trump administration launched a list of targets on July 10th, announcing that the United States will impose a 10% tariff on 200 billion US dollars of products imported from China. The trade war has the potential to be further upgraded.

In 2017, China’s lighting industry exports totaled 40.88 billion US dollars, of which about 10 billion US dollars of lighting products exported to the United States, exports to the US market accounted for 24.5% of the total export value of the industry. The White House launched a new target list, covering 30 categories of products in nine categories of lighting industry in China, covering 67% of all categories exported to the US, the amount involved is about 82%

More than a decade ago, China’s lighting appliance manufacturers, under the guidance of government and industry organizations, implemented new lighting technology development and transformation and upgrading of products. As some enterprises still have certain production capacity of traditional lighting products, some manufacturers have seized the “golden tail” of traditional lighting products to pan for gold in the North American market. Therefore, such products are currently exported to the United States and still occupy a certain amount and a large proportion. Products such as tungsten halogen lamps and energy-saving lamps have always been the favorite lighting products for American consumers. The EU market will not find the halogen lamp gradually after 2018, and US market has been expected to end, but the current market-heat has not significantly decreased. Energy-saving lamps are widely used in the US market and have been the first choice for American families who love high-efficiency lighting products for many years. It can be foreseen that once the US government’s new target list is implemented, many consumers in the United States will spend more on spending habits or change their consumption habits to replace them with new ones.

At present, China has been the largest producer and exporter of lighting products in the world. With the technological advancement of the industry, equipment upgrades and product upgrades, the variety and quality of lighting products from China are constantly improved and promoted on the basis of good price performance.

In recent years, the number of various types of LED lighting products exported to the United States has increased rapidly, especially for LED bulbs, tungsten lamps, PAR lamps, downlights, tube, panel light, etc. Many enterprises (especially large and medium-sized enterprises) have basically completed the transformation and upgrading of traditional lighting to LED lighting products. As the purchase of components and raw materials is convenient, the industrial chain is complete, especially with a large number of skilled workers, it is expected that the competitive advantage of China’s lighting industry in the international market is more obvious. But with the escalation of trade wars, market competition and corporate exports will face new pressures.

Because of the distinctive features and complementarity of the Chinese and American industries and markets, exporting enterprises expect the market of the two countries to be mutually beneficial in the context of a relatively stable exchange rate. But in the face of the changing and uncertain policies of the Trump administration, Chinese lighting manufacturers will also have a variety of choices and preparations.

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