Despite Nichia planned to enter into LED markets in China and enlarge its market share there, it has been foiled by simmering anti-Japan sentiment in China due mainly to the Diaoyutai island issue, so is considering to cooperate with Taiwanese enterprises for further development.

And two Taiwanese companies, including Hon Hai Group and Epistar, will be part of the joint venture.

According to senior Nichia executives and based on positive outlook towards widespread use of LED lighting, the firm focused on the ample business potential in China, having invested at least renminbi 20 billion to expand production lines and sales footholds in China this year.

For instance, excluding the footholds in Beijing and Shanghai, to cope with rising demand in China, the firm planned to extend distributorships in Guangzhou, Southern China, as well as increase production capacities 20% there.

Influenced by anti-Japan sentiments due to the sovereignty of the Diaoyutai islet, many Chinese operators refuse to choose LED components from Japan, which compounds Nichia’s attempt to encroach on the long-established presence of Philips and Cree in China, all of which cast shadow on the rapid progress made by Nichia in China.