The visibility of automotive product orders for LED manufacturer Edison is projected to extend throughout 2025, instilling confidence in the growth momentum of automotive orders. The company anticipates that both its LED lighting and automotive businesses will experience double-digit growth in 2025, particularly with finished product applications expected to achieve a compound annual growth rate of 20%.
Edison stated that it is currently focusing on lighting and automotive markets. In the LED lighting segment, aside from Taiwan's ESG lighting applications, the company aims to target the European green energy lighting market, expanding towards different customer groups and striving to secure large international clients through environmentally friendly and energy-saving concepts.
In terms of automotive products, the focus is currently on fog lights, tail lights, grille lights, and interior reading lights. Primarily targeting the North American market, the company is collaborating with international manufacturers to develop new products and expects significant growth in automotive shipments by 2025.
Regarding production capacity utilization across various products, the automotive production lines encompass components, modules, and finished products. Currently, the utilization rate for automotive finished products is approximately 80-90%, while modules are around 70-75%. However, the utilization rate for automotive components is lower at about 60% with fewer shipments of LED lighting components. The average utilization rate for SMT module to finished product assembly lines stands at 70-80%.
In terms of revenue contribution, automotive LED products account for 48%, general LED products for 47%, and sensor components for 5%. Automotive LED components mainly serve Chinese automakers, including Nio, Li Auto, and Xiaomi. The automotive modules and finished products predominantly cater to the North American market, supplying first-tier automotive lighting clients.
The share of automotive products is expected to further increase in 2025, with an ongoing effort to enhance the proportion of finished products, thereby fostering customized collaboration models with customers.
New Zhongli factory acquired in response to international demands
To address the demands from international manufacturers regarding production line length and scale, Edison stated that existing facilities can no longer meet these needs. Therefore, it acquired a new factory in Zhongli, which is set to be completed in June 2025, with mass production expected to commence in the fourth quarter.
Once space becomes available in the existing Zhonghe plant, it will accommodate the automotive production lines of its subsidiary, Edison-Litek, in preparation for future capacity expansion. Consequently, capital expenditures for 2025 are estimated at NT$100 million (approx. US$3.07 million), focusing not only on the renovation of the Zhongli factory but also on enhancing equipment utilization rates and efficiency.
Looking ahead, Edison noted that the order visibility for LED lighting is about two months, whereas the visibility for automotive products could last up to one year. Although the industry is expected to enter off-season in the fourth quarter, stable demand for automotive products may mitigate seasonal downturns, potentially extending growth trends into the first quarter of 2025.
Benefiting from consistent growth in orders from European and American clients, Edison projects that finished product shipments in lighting and automotive sectors will grow by at least 20% in 2025, while shipments of lighting and automotive modules are expected to see growth between 10-20%. Currently, the gross margin performance for automotive finished products and lighting modules is favorable, and with improved utilization rates, there is optimism for enhanced gross margins, maintaining a positive outlook for operations in 2025.
