South America LED Lighting Market SIZE & SHARE ANALYSIS - GROWTH TRENDS & FORECASTS UP TO 2030

South America LED Lighting Market Trends

Automobile production to boost the LED lighting market

• With 656 million people as of 2021, Latin America made up around 8.37% of the world's population. The population of Latin America increased by almost 0.9% in 2022 compared to 2021. Compared to 2019, the total fertility rate in Latin America and the Caribbean did not significantly change in 2020 and stayed at about 1.99 children per woman. Many people are relocating to metropolitan regions as the population grows in search of better employment and educational possibilities. The demand for residential properties in Latin American cities is rising as a result of the growing urban population. Some Latin American governments have taken action to support pro-poor urban infrastructure, particularly with respect to housing. The increase in the demand for residential properties will increase the demand for LED in South America.
• In South America, a total of 9.63 million cars were produced in 2022, and that number is projected to rise to 9.83 million in 2023. The number of EVs is rising in Latin America. For instance, a rise in the sales of electric vehicles is being driven by premium car purchasers in Latin America. In the region, about 25,000 EVs were sold in 2021, more than twice as many as were sold in 2020. With regional differences, EV sales in 2021 were 0.7% of all auto sales from Mexico to Chile. The country with the biggest sales (13,000 units) and the highest percentage (2.7% of all sold automobiles had a plug) was Costa Rica. As a result, it is predicted that the demand for LED lighting is expected to increase in the automotive industry.

Increasing population and affordable housing plans in the region to drive the growth of the LED lighting market

• In South America, Brazil, Colombia, and Argentina are the main countries in terms of revenue and population. In this region, Brazil occupied a major share of the population, which accounted for 212.5 million, followed by Colombia with 50.8 million in 2020. 85.5 % of the population lives in urban areas. The population in this region is growing at a rate of 0.8% change. Thus, the increase in population is expected to create more LED penetration and increase the need for illumination in the country.
• In Brazil, disposable income is growing, which results in the rising spending power of individuals and affording more money on new residential spaces. Brazil's monthly earnings increased up to USD 4,779.7 in December 2017 from USD 4,272.3 in December 2016. In Argentina, monthly earnings increased to USD 4,354.6 in December 2022 from USD 3,539.2 in December 2021.
• Brazil’s affordable housing program is making a return. Brazil’s president announced plans to restart the nationwide federal housing program for low-income individuals in February 2023. President initially created the program, named “Minha Casa, Minha Vida,” which translates to “My Home, My Life,” in 2009. Sales of homes are increasing, and construction work is picking up. The overall number of residential sales in Sao Paulo increased by 7.9% year-over-year to 50,728 units in the first three quarters of 2022, and the number of launches increased by 4.3% to 51,715 units. The above instance suggests that the rate of house ownership will increase in the coming years because, as stated above, the government offering housing programs, sales of homes, and new constructions of homes are increasing. Such instances are expected to surge the demand for LED lighting in the region.

OTHER KEY INDUSTRY TRENDS COVERED IN THE REPORT

Segment Analysis: Indoor Lighting

Commercial Segment in South American Indoor LED Lighting Market

The commercial LED lighting segment dominates the South American indoor LED lighting market, commanding approximately 68% market share in 2024. This segment encompasses office spaces, retail establishments, healthcare facilities, educational institutions, and other commercial buildings. The growth is primarily driven by extensive commercial real estate developments across major South American cities, particularly in Brazil and Colombia. The Chilean government's initiative to open public tenders for 14 concession contracts worth USD 4.6 billion in 2023, including the USD 398 million airport light rail project, exemplifies the robust commercial development in the region. Additionally, the expansion of retail chains and shopping centers, coupled with the rising trend of green building certifications, has significantly boosted the adoption of LED lighting solutions in commercial spaces.

Industrial and Warehouse Segment in South American Indoor LED Lighting Market

The industrial LED lighting and warehouse segment is experiencing substantial growth in the South American indoor LED lighting market. The segment's expansion is driven by the region's entry into the Fourth Industrial Revolution (4IR), characterized by advanced manufacturing and digitization. Major logistics players are actively expanding their footprint across South America, as evidenced by Maersk's announcement in March 2023 to expand its presence with new warehouses in Chile and Peru, adding more than 195,000 sq. m of warehouse space across the West Coast of South America. The Latin American warehousing market is further fueled by the growth of e-commerce, increased commercial activity, and rising demand from businesses for efficient warehousing and inventory management solutions.

Remaining Segments in Indoor LED Lighting

The residential and agricultural lighting segments complete the indoor LED lighting market landscape in South America. The residential segment is driven by government housing initiatives and increasing urbanization, particularly in Brazil where the affordable housing program is creating new opportunities for LED adoption. The agricultural lighting segment, while smaller in market share, plays a crucial role in supporting the region's intensive vegetable, flower, and cannabis industries, especially in Colombia where significant foreign investments are driving growth. Both segments benefit from various government initiatives and increasing awareness about energy-efficient lighting solutions.

Segment Analysis: Outdoor Lighting

Streets and Roadways Segment in South American LED Outdoor Lighting Market

The streets and roadways segment dominates the South American outdoor LED lighting market, commanding approximately 59% market share in 2024. This significant market position is driven by extensive infrastructure development across the region, particularly in Brazil where investments exceeding USD 60 billion are planned for highway development between 2023 and 2026. The Chilean government's initiatives, including the tender of approximately USD 500 million for constructing a new 24 km highway crossing the Penaflor, Carrera de Tango, and San Bernardo districts, further strengthen this segment's dominance. Additionally, the implementation of smart urban technologies by local governments throughout Latin America, aimed at enhancing service delivery and meeting sustainability targets, has significantly boosted the adoption of LED lighting in street applications.

Public Places Segment in South American LED Outdoor Lighting Market

The public places segment is emerging as the fastest-growing segment in the outdoor LED lighting market, with a projected growth rate of approximately 4% during 2024-2029. This growth is primarily driven by the expansion of retail infrastructure and public spaces across the region. Fashion retailer H&M's planned launch of stores in Brazil by 2025 and the opening of new attractions like the Nerf theme park at Beto Carrero World in Brazil in 2023 exemplify this trend. The segment's growth is further supported by the development of parking facilities near railway stations, shopping malls, and airports. The increasing focus on modernizing public spaces and the implementation of energy-efficient lighting solutions in parks, stadiums, and other recreational areas continue to drive the segment's expansion.

Remaining Segments in Outdoor Lighting

The other segments in the outdoor LED lighting market primarily encompass specialized applications such as architectural lighting for castles, forts, and heritage sites. These segments play a crucial role in preserving and highlighting historical landmarks while promoting tourism. The rising demand for artistic lighting solutions in heritage sites, including Christ the Redeemer, the Botanical Garden of Curitiba, and various art museums across South America, continues to drive innovation in specialized outdoor lighting applications. The segment also includes lighting solutions for archaeological sites and cultural monuments, contributing to the overall development of the outdoor LED lighting landscape in South America.

Segment Analysis: Automotive Utility Lighting

Headlights Segment in Automotive Utility Lighting Market

Headlights emerged as the dominant segment in the South American automotive utility lighting market, accounting for approximately 41% of the total market value in 2024. The segment's leadership position is primarily driven by increasing safety regulations and growing adoption of LED headlights in passenger vehicles across major markets like Brazil, Chile, and Argentina. The demand is further bolstered by the rising penetration of electric vehicles in the region, with luxury car buyers driving the uptick in adoption. Potholes in city streets such as Rio are the cause of 90% of traffic accidents, leading to significant demand for advanced LED headlights in both commercial and passenger cars. Major automotive manufacturers are increasingly incorporating LED headlight technology into their vehicles, as it provides up to a 60% decrease in energy consumption compared to traditional lighting solutions.

Directional Signal Lights Segment in Automotive Utility Lighting Market

The directional signal lights segment is witnessing substantial growth in the South American automotive utility lighting market. The segment is expected to maintain strong momentum through 2024-2029, driven by increasing vehicle safety requirements and technological advancements in LED signaling systems. The growth is particularly notable in Brazil, which represents the largest market for passenger cars in Latin America. The expansion of electric vehicle adoption across the region is further accelerating the segment's growth, with countries like Chile, Colombia, and Costa Rica showing significant increases in EV market share. Premium brands are focusing more on incorporating advanced LED directional signal technologies, with companies like Mercedes-Benz leading the market in Argentina and Chile. The segment's growth is also supported by various government initiatives promoting vehicle safety features and the increasing consumer preference for vehicles with advanced lighting systems.

Remaining Segments in Automotive Utility Lighting

The automotive utility lighting market in South America encompasses several other important segments including daytime running lights (DRL), reverse lights, stop lights, and tail lights. Each of these segments plays a crucial role in vehicle safety and functionality. Daytime running lights are becoming increasingly standard in new vehicle models, particularly in premium segments. Stop lights and tail lights are essential safety components that are seeing increased adoption of LED technology for better visibility and energy efficiency. Reverse lights, while representing a smaller segment, are crucial for vehicle safety during parking and maneuvering. These segments are experiencing varying levels of growth driven by factors such as safety regulations, technological advancements, and increasing consumer preference for vehicles with advanced lighting features.

Segment Analysis: Automotive Vehicle Lighting

Passenger Cars Segment in South America LED Automotive Vehicle Lighting Market

The passenger cars segment continues to dominate the South American LED automotive vehicle lighting market, accounting for approximately 52% of the total market share in 2024. This dominance is primarily driven by the increasing adoption of electric vehicles across the region, with Brazil leading the market in terms of unit sales exceeding 1.58 million units. The Toyota Hilux and Chevrolet Onix remain among the top-selling models, contributing significantly to LED lighting demand. The segment's growth is further supported by various government initiatives promoting electric vehicle adoption, with countries like Chile implementing policies targeting 100% of new light-duty vehicle sales to be EVs by 2035. Premium brands are increasingly focusing on EV vehicles in the region, with Mercedes-Benz ranking as the most popular brand in Argentina and Chile, commanding over 15% market share in these countries.

Two Wheelers Segment in South America LED Automotive Vehicle Lighting Market

The two-wheelers segment is emerging as the fastest-growing category in the South American LED automotive vehicle lighting market, expected to grow at approximately 18% between 2024 and 2029. This remarkable growth is driven by the expanding motorcycle industry across 17 countries in the region, including major markets like Mexico, Brazil, and Argentina. The segment's expansion is particularly notable in Brazil, which has the largest motorcycle per capita ratio in South America, with about 85% of its electric grid being renewable. The market is witnessing significant developments in electric two-wheelers, with companies like Voltz achieving record sales. The growth is further supported by strategic alliances between international manufacturers and local players, aimed at delivering smart, connected electric motorcycles to the South American market.

Remaining Segments in Automotive Vehicle Lighting

The commercial vehicles segment represents another significant portion of the South American LED automotive vehicle lighting market. This segment encompasses a wide range of vehicles including light commercial vehicles, heavy trucks, coaches, and buses. The segment's development is closely tied to the region's expanding logistics and transportation sector, with pickups dominating the light commercial vehicle category. The segment is experiencing a transformation with the introduction of electric commercial vehicles, particularly in urban transportation, with countries like Colombia mandating that all vehicles purchased for public transportation systems must be zero emission by 2035. The growth in this segment is further supported by increasing investments from international manufacturers and the rising demand for advanced lighting systems in heavy commercial vehicles.

Free With This Report

We provide a complimentary and exhaustive set of data points on the country and regional level metrics that present the fundamental structure of the industry. Presented in the form of 40+ free charts, the sections cover difficult to find data on various countries on Automotive Production, Lighting Electricity Consumption, Road Network, Number of Stadiums, Number of Charging Stations among others.