As we all know, after the sale of its Roundmans business, Osram is now focusing more on high-tech fields. The operation of the Kulim LED chip factory in Malaysia marks a significant step in this transformation. Olaf Berlien, Chairman and CEO of OSRAM Group, stated: “Ten years ago, traditional lighting made up 80% of our business; today, two-thirds of our sales come from optoelectronics-based products.†This shift highlights the company’s strategic move toward innovation and advanced technology.
The high-tech sector has delivered impressive results for Osram. According to the company's fiscal year 2017 financial report, revenue exceeded 4 billion euros, an 8% increase compared to the previous year. This growth was driven by strong demand for high-tech products, particularly optoelectronic semiconductors. Operating profit rose from 1.03 billion euros to 695 million euros, with a profit margin of 16.8%, demonstrating the success of their new direction.
Looking ahead, Osram plans to focus on several key areas: automotive lighting and components for driver assistance and autonomous driving systems, health monitoring technologies for smart devices, smart lighting solutions for streets and buildings, stage and entertainment lighting, specialized lighting such as plant lighting, and digital communication solutions like indoor positioning technology.
At the inauguration of the Kulim factory, various applications were showcased, including infrared, autonomous driving, laser radar, wearable devices, and plant lighting. Among these, intelligent car lighting has become a major focus for Osram. According to a company representative, their laser illumination system significantly enhances road safety by increasing brightness and extending the range of remote light by more than double. This improves visibility and clarity for drivers. Infrared laser devices are a critical component of Osram’s automotive lighting systems.
In the field of infrared LEDs, Osram is also showcasing sensors for iris scanning, driver assistance systems, and health monitoring. Iris unlocking, for example, is being demonstrated by Olaf Berlien and Stefan Kampmann, the Chief Technology Officer. Osram is a key supplier of sensors for smartphone unlocking functions, such as those used in Samsung devices. Health monitoring applications include smartwatches and wearable health bands that track heart rate and blood oxygen levels.
In the area of autonomous driving, high-end driver assistance systems can detect road conditions, sense rain, identify blind spots, and monitor fatigue. Osram’s infrared devices play a crucial role in these systems. The company has acquired a 25.1% stake in Canadian lidar company LeddarTech, reinforcing its position in the autonomous driving market. Stefan Kampmann said, “Osram is the world’s leading supplier of sensor lights for self-driving vehicles, and demand in this area is growing rapidly. Investing in LeddarTech is a necessary step to strengthen our leadership in this field.â€
All these innovations rely heavily on LED components. Based on positive market forecasts, Osram announced the construction of a new LED chip factory in Kulim in November 2015, part of its “Diamond†innovation and growth plan. By the end of 2017, the factory was completed and operational, contributing to a 19% growth in the LED business. Olaf Berlien expressed satisfaction with the progress and the potential for further expansion.
With the completion of the first phase, Osram invested a total of 370 million euros in the Kulim factory. A two-stage expansion is planned, with a total investment of 1 billion euros. This includes expanding LED assembly capabilities within the global factory alliance.
Aldo Kamper, CEO of OSRAM Opto Semiconductors, highlighted the factory’s high productivity. He noted that the Kulim plant can produce street lighting for cities like New York, Rio, Hong Kong, and Berlin in just one week. If the entire world were to upgrade to LED lighting, the factory could meet the demand in about five and a half years. LED lighting saves nearly 80% compared to traditional lighting and offers better color stability and faster dimming.
By March or April next year, the Kulim factory will reach a production capacity of 20,000 chips per week. The blue LED chips produced there convert light into white through a phosphor layer, suitable for general lighting, building facades, commercial and residential lighting, billboards, and plant lighting.
The global LED general lighting market is expected to reach 6 billion euros by 2018, with 6% of that coming from street lighting. The market is projected to grow at an average annual rate of 7% until 2020. By 2018, the overall optoelectronics market, including general lighting, is expected to reach 17.5 billion euros.
Once the second phase of the Kulim plant is complete, Osram plans to produce LED chips for high-end applications such as automotive lighting and video projection. Located in a green space, the factory offers design flexibility. It also uses the latest 6-inch wafer technology, which produces 125% more LED chips per wafer compared to 4-inch technology.
Osram is currently expanding its global LED production network, including the Regensburg plant in Germany, which is adding 1,000 jobs. The plant produces advanced LED chips and laser diodes for automotive headlights and infrared diodes for sensors used in face recognition and car assistance systems.
Other expansions include the Schwabming plant in Germany, where LED raw materials will be produced in clean rooms, and the Exeter facility in the U.S., which makes LED components. In Wuxi, China, Osram is improving back-end assembly capabilities, such as producing LED housings and optical components. There is also a Penang factory near Kulim that produces LED chips.
Overall, Osram’s strategic investments in high-tech manufacturing and innovation have positioned it as a leader in the optoelectronics industry, paving the way for a brighter, smarter future.
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