LED Lighting Market - Growth, Trends, and Forecast (2020 - 2025)
The Market is Segmented by Application (Indoor, Outdoor), Product Type (Lamps, Luminaires), Distribution Channel (Direct Sales, Wholesale/Retail), and Region.
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Scope of the Report
Key Market Trends
TABLE OF CONTENTS
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The LED lighting market is valued at USD 58.91 billion in 2018 and is expected to reach USD 127.97 billion by 2024, with a CAGR of 13.75% during the forecast period (2020 - 2025). By transitioning to energy-efficient LEDs, an estimated savings of USD 18 billion in electricity costs can be achieved. Furthermore, more than 160 million metric ton of carbon dioxide emissions can be avoided every year.
In the United States, all electrically controlled devices, including LED light bulbs, must meet the minimum safety standards. The regulations regarding these safety standards are covered in the United States by laws, such as the Occupational Safety and Health Act (OSHA), Code of Federal Regulations (CFR), and standards, such as the National Electric Code (NEC).
Also, as part of the 2007 national energy bill passed by Congress with bipartisan support and signed into law by the President of the United States, energy efficiency standards were established for new light bulbs that ensured a smooth and gradual national transition to energy-saving bulbs. California’s regulations expedited the transition. Furthermore, in May 2018, the United Nations announced a groundbreaking energy efficiency regulation for light bulbs that can be easily adopted by developed and developing economies.
The growing consumer awareness about the environment and the durability of these lights, along with the government mandates for energy efficiency, are the drivers for the growing adoption of LEDs. For instance, the Chennai airport, as part of its green initiatives, bought six sets of LED base lights for use for disaster relief, as part of the measures to make its lights and fixtures energy-friendly.
Smart lighting is expected to be the future of LED lighting, with various companies, like Philips, Magiclight, and Xiaomi, investing in the technology. Philips is one of the market leaders with its product, Philips Hue, which can be integrated with voice assistants.
Scope of the Report
LED stands for light-emitting diode. LED lighting products produce light approximately 90% more efficiently than incandescent light bulbs, such as fluorescent and incandescent lights. About 95% of the energy in LEDs is converted into light and only 5% is wasted as heat, which is leading consumers to opt for a more efficient form of lighting.
The market is segmented by different applications of LED lighting, such as indoor and outdoor, with various sub-applications. In the indoor segment, the market is further segmented into residential, commercial, industrial, and government. In the outdoor segment, the market is further segmented into highway and roadway, architectural, and public places. The market is also segmented by product type. The scope of the report offers a detailed regional analysis.
Highway and Roadway
Rest of Europe
Rest of Asia-Pacific
Middle East & Africa
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Key Market Trends
Commercial Segment Expected to Witness Significant Growth Rate
The commercial floor lighting segment has evolved, with the LED lights being offered from 4,000 lumens to more than 60,000 lumens. LED lights are manufactured with integrated LEDs instead of traditional bulbs. This method of manufacturing eliminates the need for frequent replacements. These lighting solutions have a longer life span, outlasting the HID and halogen fixtures.
The desire to save energy, high efficiency, reliability, and longer life span are the driving factors for LED adoption in commercial buildings. Also, building energy codes are beginning to increase adoption with the requirement of more advanced control strategies in more commercial spaces.
LED lights provide a consistent light, improving the overall visibility, and offers added security for commercial locations. These lights can be paired with motion sensors, photocells, and timers to offer a lighting control system for efficient usage.
Regulatory adherence and safety test required for new products are expected to delay the availability of new products in the commercial lighting market. Also, countries that implement the regulation in a harmonized manner may reduce trade barriers and provide new opportunities.
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Latin America is Expected to Occupy Significant Market Share
In Latin America, nearly 80% of the total population resides in urban areas, which is expected to rise during the forecast period. By the end of 2045, urban dwellers are estimated to increase by two billion, globally. Thus, in such a scenario, it becomes essential for countries to use energy more efficiently.
The growth of the LED lighting market in the country can be attributed to the declining manufacturing cost of LEDs and the increasing demand for energy-efficient and sustainable lighting. Also, healthy economic growth, robust industrialization, and urbanization tend to be some of the macroeconomic factors driving the market.
Furthermore, growing awareness over the importance of energy efficiency, coupled with the regional government mandates to set higher standards for more energy efficiency, and continuous innovations in LED technology by the leading manufacturers, is a significant factor driving the growth of the market in the region.
Buildings are among the largest consumers of electricity, worldwide. However, according to estimates, 80% of the energy efficiency potential of the buildings is not utilized. For instance, Rio de Janeiro consumes 60% more energy for public lighting compared to New York City.
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The LED lighting market is highly fragmented, with the presence of a large number of regional and international players across the world. Due to the fragmented nature of the market, the competition among the players is high. The major companies in the LED lighting market are launching new products to improve their positions in the market.
For instance, in March 2018, Samsung Electronics Co. Ltd announced the launch of H inFlux, a linear module that uses the company’s LED chip package LM301B. H inFlux is specially designed for lighting applications in factories, warehouses, and covered parking lots. The product comes with different luminous flux levels, offering a variety of footprints and color temperatures (such as 3000K, 3500K, 4000K, and 5000K).
Also, in January 2018, Sharp Corporation and Universal Display Corporation entered into an extended and updated evaluation agreement. Under the agreement, Universal Display will supply its proprietary Universal PHOLED phosphorescent OLED materials and technology to the Sharp Corporation for usage in the company’s OLED displays.
In May 2018, Cree expanded its SmartCast intelligence platform, with various features, like the wireless enabling smart building solutions catering to the rising demand from IoT. This is likely to boost its presence and foster financial growth.