The automotive lighting sector is undergoing a transformative reshuffle.

◎ Hyundai Mobis has divested its lighting division to France’s OPmobility in a $443 million deal.

◎ Meanwhile, China’s Xingyu Shares has ascended to the global top 10 automotive lighting suppliers, while BYD, Leapmotor, and Great Wall Motors are bringing lighting production in-house.

This raises questions: Where is the industry headed long-term? Does the $443 million sale signal declining value in traditional automotive lighting?

Part 1: China’s Dominance in Complete Lighting Systems Contrasts with Mobis’ Exit

OPmobility acquired Hyundai Mobis’ lighting business for approximately $443 million. The division generated €1.6 billion in 2025 revenue with a positive operating margin, yet its enterprise value stood at just €390 million—0.24 times the prior year’s revenue.

Despite its global footprint, OEM client base, and mature R&D capabilities, the business’s modest valuation reflects shifting industry dynamics. As lighting evolves from a basic illumination tool into an intelligent electronic system, traditional valuation metrics for complete lighting manufacturers are being redefined.

OPmobility aims to deepen ties with Hyundai and Kia by integrating lighting with exterior components into unified modules. Mobis, meanwhile, seeks to reallocate capital toward electrification and automotive electronics.

Xingyu Shares now ranks among the world’s top 10 automotive lighting suppliers. In 2025, its revenue surged to ¥15.257 billion (+15.12% YoY), with net profit attributable to shareholders reaching ¥1.624 billion (+15.32% YoY). From ¥10.248 billion in 2023 to ¥15.257 billion in 2025, cumulative two-year growth approached 49%.

Its client roster spans Volkswagen, Mercedes-Benz, BMW, and Toyota, alongside domestic players like Chery, Geely, NIO, Li Auto, XPeng, and Seres—without over-reliance on any single automaker.

More notably, automakers themselves are entering the fray:

◎ BYD’s Fudi Vision, established in 2020, focuses on lighting R&D and manufacturing, having developed over 50 models and 600 lighting variants.

◎ Leapmotor’s Huzhou mega-factory produces batteries, electric drives, domain controllers, and lighting, with in-house R&D and manufacturing accounting for 65% of total vehicle costs—lighting being a clearly defined self-produced category.

◎ Great Wall Motors, via Mand Electronics, deploys complete lighting systems, optical modules, and electronic controls. China’s automotive lighting ecosystem is expanding from specialized suppliers to automakers’ internal systems.

Part 2: Core Component Dependence Persists, Domestic Substitution Looms as Next Challenge

Foreign Control Over Core Components: Xingyu’s Controllers Account for Just 1.5%

Viewing lighting as an electronic system reveals stark contrasts. Xingyu’s 2025 automotive lighting revenue hit ¥14.362 billion, yet controller revenue stood at just ¥216 million—up 220.78% YoY but accounting for only ~1.5% of total revenue. While Xingyu promotes DLP, MicroLED, and lighting controllers, its core revenue still stems from complete lighting systems.

Despite local production of lamps, MCUs (for control logic) and driver ICs remain predominantly imported.

The light source market is even more concentrated. According to TrendForce’s 2026 research, the global automotive headlamp LED market reached $1.085 billion in 2025, with ams OSRAM holding over 50% share. No matter how many complete lamps China manufactures, the most valuable optical chips still flow to Osram.

NIO’s ET9 headlamp exemplifies this: While Marelli handles system integration, the critical pixel light source uses ams OSRAM’s EVIYOS HD25, featuring over 25,000 independent pixels.

Chinese manufacturers can assemble the housing, but high-end light sources and drivers remain constrained by upstream international suppliers.

ADB, MicroLED, DLP: Technology Tiers Dictate Profit Distribution

Smart lighting falls into five tiers:

◎ Basic illumination: LED sources and lenses, now widely adopted.

◎ Adaptive illumination: Matrix ADB for automatic glare reduction, penetrating more price segments.

◎ High-resolution illumination: HD-ADB and MicroLED, expanding into premium mass production.

◎ Digital projection: DLP and pixel projection, already in production but costly.

◎ Interactive illumination: MiniLED, OLED, and ISD light language, growing rapidly but subject to regulatory constraints.

Two technological routes warrant comparison:

◎ ams OSRAM’s EVIYOS HD25 uses 25,600 independently controlled pixels for light shaping.

◎ Texas Instruments’ DLP5531-Q1 employs over 1.3 million addressable micromirrors for high-resolution road projection.

Pixel count alone doesn’t determine performance—light efficiency, heat dissipation, and driving methods vary significantly. However, one fact remains: these core components originate from Osram and TI, not Chinese manufacturers.

True competitive barriers lie in ADB glare suppression, high-resolution beam control, and long-term reliability—not merely stacking LEDs.

Data underscores operational pressures for complete lamp manufacturers. FORVIA HELLA’s 2025 lighting sales reached €3.7 billion (-8.3% YoY), with operating profit of €106 million and a mere 2.9% operating margin. That same year, its automotive electronics business achieved a 7.8% operating margin. Higher-tech complete lighting doesn’t necessarily yield greater profits for lamp manufacturers.

Complete lamp makers shoulder precision injection molding, optical development, electronic assembly, tooling, testing, validation, and factory depreciation. Meanwhile, upstream suppliers of key light sources and chips sell relatively standardized components to multiple lamp manufacturers.

This necessitates viewing two distinct markets:

◎ Complete lighting: Large scale but heavily influenced by project development, manufacturing, customer bargaining power, and capital expenditures.

◎ Light sources, driver chips, and electronic controls: Smaller scale but with high technical concentration in some products.

Opportunities in China’s automotive lighting industry fall into two categories:

◎ Xingyu and Huayu Visual continue expanding global share in complete lighting.

◎ Domestic light sources, optical components, driver chips, and lighting controllers penetrate high-end supply chains.

What makes the automotive lighting industry fascinating is its duality—simultaneously a traditional component sector and a modern automotive electronics field.

◎ One end involves molds, injection molding, coating, assembly, and project delivery.

◎ The other comprises semiconductor light sources, software, electronic controls, and high-resolution optics.

Hyundai Mobis divesting lighting, OPmobility pursuing acquisitions, Xingyu capturing overseas clients, and BYD/Leapmotor increasing self-production ratios may seem contradictory, but they represent different corporate choices regarding industrial division of labor and cost structures.

For Chinese suppliers, complete lighting localization has reached the global top 10. The next challenge is localizing critical components.

◎ Xingyu and Huayu Visual’s domestic and international project revenue and gross margins will reveal whether globalization truly generates profits.

◎ Fudi Vision, Leapmotor, and Mand’s complete lighting capacity versus external supply ratios will show how much market share independent Tier 1 suppliers lose to automaker self-production.

◎ Actual installation rates of ADB, HD-ADB, DLP, and MicroLED will indicate whether technological upgrades translate to market growth.

◎ Most critically, whether domestic light sources, automotive lighting MCUs, and driver ICs secure high-end project design wins will mark the true watershed from complete lighting localization to critical component localization.

Conclusion: The Lights Are Chinese-Made, but the Future Depends on Core Components

Opportunities remain in the automotive lighting industry, but they vary by enterprise type. Traditional complete lamp manufacturers face inventory competition and structural upgrades, while Xingyu and Huayu Visual see their internationalization window open. BYD and Leapmotor’s self-production will persist as vertical integration, and semiconductor/optical component firms gain new opportunities from intelligent lighting upgrades.