Taiwan Manufacturers Take Aim At T5 Lamps

Although leading international lighting-source manufacturers have been selling T5 fluorescent lamps in Taiwan for nearly five years, and despite the fact that these lamps have become standard in parts of Europe and North America, they still account for only an insignificant portion of Taiwan's lamp market. The island's two top lamp makers, however, feel that sooner or later T5 lamps will replace the T9 lamps that now dominate the domestic market.

The new T5 fluorescent lamps are being pushed jointly by Philips and Osram as a replacement for their last-generation T8 lamps. Lighting manufacturers and end-users have come to realize that the new lamps are much better than the old ones in terms of power conservation, environment-friendliness, and high-frequency flicker performance.

Bernett Wang, manager of Osram Taiwan's technical customer-service unit, says that the T5 is 25% more efficient than the T8 and T9 in the amount of power it consumes to give off the same amount of light. The reason for this improvement, he explains, is that "the T5 uses an electronic ballast whereas the others still use copper-coil ballasts. Electronic ballasts are noted for their superior efficiency and blink frequency. For consumers, the T5 protects eyesight and reduces electricity costs."

Wang claims that an electronic ballast uses only three to four watts of electricity to keep a lamp burning, whereas a copper-coil ballast usually needs nine to 10 watts to do the same job. In addition, the T5 is 1.2 times more durable than the T8 and T9; after 40% of its normal life, the T5 is still able to maintain illumination of 95%; for the T8, the figure is 90% at best. And the T5 is smaller, 16mm in diameter compared with the T8's 25.4mm.

Therefore, Wang stresses, "The T5 is more environment-friendly, since its compact tube uses less glass and mercury." To minimize pollution, he notes, both Philips and Osram make their lamps with recyclable materials.

Better Illumination

T5 lamps are able to generate 10% more illumination compared with T8 and T9 lamps because the "bump" of the mercury particles with the interior powder coating is more intense in the T5. But this also increases heat inside the lamp, and in the early stages of development this caused instability in T5 lamps. That problem was worked out, and now both Philips and Osram have developed technology that confines temperatures within the desired range so that the lamps are stable.

Today the T8 has an ideal working temperature of 25 degrees Celsius, while for the T5 the ideal is 35 degrees. In hot countries, this gives the T5 another advantage. To accommodate the higher temperature, heat-resistant tri-wavelength fluorescent powder is now used in the lamps. Color temperature choices for the T5 range from 4, 000 to 6, 000 Kelvin.

"The T5 is highly suitable for most Asian countries, where temperatures are often quite high, " comments T.Y. Peng, executive director of Osram Taiwan. He reports that his company introduced its T5 lamps to Taiwan about five years ago, and that it has pinpointed lamp and lighting-fixture suppliers (such as China Electric Mfg. And Taiwan Fluorescent Lamp) as its target customers.

Osram Taiwan has seen its T5 sales grow by 50% annually over the past two years, but these lamps still make up only 5% of the island's estimated 40- to 50-million-unit annual fluorescent-lamp market. "In addition to the price factor, " Peng explains, "the conservative attitude of China Electric and Taiwan Fluorescent Lamp have made it difficult for the T5 to gain market share in Taiwan."

Local T5 electronic ballast suppliers say that a lighting fixture with four lamps and ballasts can cost as much as NT$3, 000 (US$88 at US$1: NT$34), 50% to 100% more than the cost of a T8-equipped equivalent.

The two Taiwanese manufacturers named above appear to be concerned about competition with their T9 products, and are reluctant to go into co-production of T5 fixtures. They followed the Japanese example and focused on the T9, Peng explains, "but the Japanese market refuses to accept Taiwan-made T9s. So the two manufacturers can sell their lamps only at home, where domestic lighting-fixture suppliers have long designed their products around the products of the two lamp makers. With their existing domination of the domestic market, the two companies are not enthusiastic about making changes.

Open Taiwan Market

Nevertheless, Peng feels that Taiwan's market is more open than Japan's. "At least, " he notes, "the Taipei 101 building and Chang Gung Memorial Hospitals have adopted T5s. In Japan no T5 deals at all have been reported, even though Osram has entered into a strategic alliance with lamp-maker Mitsubishi Electric there."

In Europe, by contrast, the T5 has replaced the T8 at government request; the German government, for example, has ruled that all new buildings must use the T5. Nearly 80% of all recently built houses there now use T5 lamps.

Peng is confident that the T5 will soon come to dominate the global lamp market. The reason, he says, is that "Osram and Philips together control over 50% of the worldwide lamp market, making it easy for them to dictate new specifications. GE too supports the T5, making it even more certain that it will become the standard before long."

Cheng Nan-sheng, chairman of Taiwan Fluorescent Lamp, feels that while the T5 will replace the T9 sooner or later, he hopes that it does not happen too quickly. If the replacement is too fast, he explains, "It will be like what happened in the Southeast Asian T8 market. Since mainland China entered the WTO, its T8 lamps has elbowed locally made products out to take control of the market in Southeast Asia. Even Taiwan's T8 lamps are mostly made in the mainland."

Cheng says that his company has not yet begun making T5 lamps, because domestic demand is not large enough to permit manufacturing on an economic scale. Another problem is brand awareness. "If we start to make the lamps now, " he asks, "who will buy them? Foreign buyers recognize only the Osram and Philips brands. And if we sell them at home, we will have to fight for market share with the world's top three suppliers. Why should we give up our current dominant position (in the T9 market)?"

Seeking Economic Scale

Nevertheless, the company has been making T5 lighting fixtures for five years, and has sold them-complete with lamps made by Osram and Philips-to the Formosa Plastics Group. His firm requires about 100, 000 T5 lamps a month, Cheng reports, a quantity that is insignificant compared with its production of two to three million T9 lamps a month. "We'll probably start making the lamps ourselves once our outsourcing volume tops 10, 000 units per month. To prepare for that eventuality, we're developing our own brand name."

China Electric began making T5 fixtures around three years ago, also using T5 lamps from Philips and Osram. E.P. Tsai, the company's former president and now general manager of its lighting-source department, estimates that the consumption of T5 lamps in Taiwan will reach two million units this year, far lower that the company's "critical mass" of six million. He does not expect the six million figure to be achieved any time soon.

Tsai agrees with the idea that the T5 will become the mainstream lighting source worldwide, since it has already taken over half of Europe's T8 market and is now being promoted by mainland China. However, he notes, "In Asia the new lamp still has a long way to go before it becomes the dominant lighting source, because Japan is not crazy about it." The T5 came to Asia relatively late, he observes, because its international standard was finalized only recently and most of its shortcomings were overcome not long ago.

The quality of the T5 lamp has been stabilized, but Tsai believes that it still faces some problems. For example, both of its electrodes tend to turn black because of its compact size. "This makes the lamp look imperfect, " Tsai notes. "Also, the problem of specification match between the lamp and the electronic ballast still exists."

The target that Tsai's company has pinpointed as the major market for its T5 fixtures is commercial buildings, since the builders usually contract professionals to design lighting layouts for the buildings. The professional designers, he says, find it relatively easy to accept new lighting sources. (Sept. 2004)