Price Hike for Photocouplers Expected for 2021 Given Shortage of Chips and Raw Materials in Upstream Supply Chain, Says TrendForce

Owing to the rapidly growing demand for EV quick charging poles, as well as the recovering market for consumer electronics and industrial control systems, there has been a shortage of chips and raw materials in the upstream supply chain, according to TrendForce’s latest investigations. Therefore, prices for photocouplers, which are an essential component in the aforementioned products, will gradually rise throughout 2021.

TrendForce further indicates that, given the overall shortage in the semiconductor market, major photocoupler suppliers, such as Taiwanese LED companies as well as other Japanese, European, and U.S. companies, are planning to increase their quotes for photocouplers in response to the price hikes in photocoupler materials, including infrared LED chips, precious metals, and packaging adhesives. For instance, Lite-On has first announced that it will raise its photocoupler prices by about 10-20% in February 2021, while Everlight will soon follow suit.

As an application of infrared technology, photocouplers contain infrared LED chips and photodetectors and are used as a control device for transmitting electric signals. They are primarily used in power adapters for home appliances and consumer electronics, as well as UPS (uninterruptible power supplies). In recent years, the increasing demand for inverters (which are used in quick chargers, EVs, and charging stations) has brought about a wave of demand in the photocoupler market as well. In addition, automotive battery management systems and industrial control systems also require the use of high-speed and high-stability photocouplers, in turn representing yet another growth driver for the global photocoupler market.

Many companies have been gradually looking to participate in the photocoupler supply chain because of several reasons: First, the bullish outlook of the photocoupler market; second, the relative stability of the supply chain; and finally, the difficulty involved in changing photocoupler suppliers once a supplier has been established as an industry partner. At the moment, major photocoupler suppliers include Avago (Broadcom), Toshiba, Renesas, Vishay, Rohm, Lite-On, Everlight, and Lightning. On the other hand, major suppliers of infrared LED chips used in photocouplers include Taiwan-based companies (Epistar, OptoTech, and TYNTEK), Korea-based LGS, and China-based Sanan. TrendForce expects global photocoupler revenue to reach US$1.606 billion in 2020.


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