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With the governments of various countries, especially developing countries, such as India, China, and Indonesia, focusing on the modernization of infrastructure, the demand for LED lighting solutions has considerably increased in these economies in recent years. The growing adoption of energy-efficient lighting solutions and declining prices of LEDs are the key growth factors driving the LED lighting industry. The global LED lighting market size was $67.6 billion in 2019, and it is projected to witness a CAGR of 12.9% during the forecast period (2020–2030).
The COVID-19 pandemic that started in late 2019 has severely impacted the LED lighting market across the globe. The stringent lockdown measures implemented by governments have led to the postponement of residential projects in countries including India and China. Additionally, the disruption in the supply of electrical components from China is another consequence of the pandemic on the LED lighting market.
In the LED lighting market outlook, the luminaire category generated higher revenue in 2019, which can be attributed to the high demand for LED luminaires, primarily from newly constructed residential and commercial buildings. Furthermore, with the increasing government initiatives toward the adoption of LED lighting, in countries such as India, China, and the U.A.E., the market for LED luminaires is projected to grow in the near future
The retrofit category, based on installation type, is projected to experience faster growth in the LED lighting market during the forecast period. The growth is attributed to the increasing replacement of sodium-vapor and incandescent lamps with LED lights, in countries such as India, Japan, China, the U.A.E., the U.S., and South Korea. The strong demand for retrofit LED lamps in these countries, due to the phasing out of incandescent bulbs, is expected to further boost the LED lighting market in the forecast period. This category is further classified into A-lamp, reflector, T-lamp, and others.
Based on the application of LED lighting products, the outdoor category grew at faster pace till 2019. The category is further expected to maintain its pace in the LED lighting market during the forecast period. This can be ascribed to the growth in both private and government initiatives around the world for high-class infrastructure development, which are pushing the demand for LED lighting. For instance, in 2019, Integrated Device Technology Inc. (IDT), a subsidiary of Renesas Electronics Corporation, announced plans to start two intelligent street lighting projects in Malaysia, for the replacement of sodium-vapor bulbs with LED lights.
This category is further divided into highways, streets, stadiums, parking lots, tunnels, and others. The highways division held the largest market share in 2019, and the situation is projected to remain the same in the future. This is mainly due to the development of smart cities around the world, which involves the installation of LEDs on highways and streets to save energy and reduce maintenance costs.
The APAC region held the largest LED lighting market share during the historical period (2014–2019). It is mainly attributed to the growing demand for LED lighting from the residential sector, especially in China, India, and South Korea. The growth in construction and infrastructural development in the region is due to the booming population, which, in turn, is fueling the demand for LED lighting solutions. Further, the growing consumer awareness for energy-efficient lighting, due to the rise in power tariff and environmental concerns, is another factor driving the demand in the APAC region.
APAC is also the fastest-growing region in the LED lighting industry, and it is expected to retain the pace throughout the forecast period. The major factor responsible for driving the LED lighting market growth in the region is the sustained surge in the urbanization rate and population in developing countries. Government initiatives for the deployment of smart lighting products, along with toughening regulations for energy efficiency, are being implemented, especially in countries such as China and India. The increasing adoption of smart lighting products, coupled with the strong government focus on developing smart cities, is further propelling the LED lighting market growth.
A prominent trend being observed in the LED lighting market is the growing popularity of smart LED lights, due to the various advantages offered by smart LED lighting over traditional lighting solutions. The high energy efficiency of these systems allows for energy savings, which reduces the cost burden on both commercial and residential users. Other features of smart LEDs include automatic off/on, motion activation technology, adaptive lighting, and the ability to change the color, to create an ambient indoor experience, as per people’s mood and preference.
One of the key factors driving the global LED lighting industry is the growing adoption of energy-efficient lighting solutions. This can be attributed to the low maintenance costs and longer operational life of LED lights, compared to conventional lights. LEDs are being widely deployed at parking lots, tunnels, stadiums, and streets. Moreover, the increasing government initiatives toward the usage of energy-efficient lighting sources and reduced energy consumption are augmenting the demand for LED lighting solutions. Local authorities in several countries are adopting these systems to completely replace their current lighting systems. For instance, in 2019, the state government of Tamil Nadu in India issued a tender for the replacement of the existing conventional street lights in Coimbatore with smart, energy-efficient LED lights. Hence energy-efficiency, combined with low carbon emissions and thermal pollution, have made LEDs a popular choice.
The declining prices of LEDs have led to their deep penetration in various applications, including residential, commercial, and industrial. This significant drop in the LED prices can be attributed to the advancements in technology, which have led to a higher life expectancy and greater operational efficiency, in turn, driving the LED lighting market. Moreover, with the adoption of energy-efficient lighting solutions, the energy consumption in lighting applications is expected to reduce. For instance, according to the projections of the U.S. Department of Energy, the energy consumed by lights in the country would drop by 15% by 2020 and by 40–60% by 2030, in a conservative forecast.
|Base Year (2019) Market Size||$67.6 billion|
|Forecast Period (2020-2030) CAGR||12.9%|
|Report Coverage||Market Trends, Revenue Estimation and Forecast, Segmentation Analysis, Regional and Country Breakdown, COVID-19 Impact, Company Share Analysis, Companies’ Strategical Developments, Product Benchmarking, Company Profiling|
|Market Size by Segments||By Product Type; By Installation; By Application; By Region|
|Market Size of Geographies||U.S., Canada, Germany, France, Italy, U.K., Spain, Japan, China, India, South Korea, Brazil, Mexico, Saudi Arabia, South Africa, Turkey, U.A.E.|
|Secondary Sources and References (Partial List)||American Lighting Association, Association of Lighting Designers, Electronic Industries Association of India, International Interior Design Association, International Journal of Sustainable Lighting (IJSL), International Light Association (ILA), Indian Society of Lighting Engineers (ISLE), Japan LED Association (JLEDS), Lighting Association Ireland (LAI), Lighting Controls Association, Lighting Industry Association, Lighting Trade Associations, Middle East Lighting Association (MELA), National Association of Innovative Lighting Distributors (NAILD), National Electrical Manufacturers Association (NEMA)|
The focus of governments, especially in developing countries, such as India, China, and Indonesia, on the development of new infrastructure, along with the modernization of existing structures, has increased in recent time, thereby leading to a rise in the demand for LED lighting solutions. The growing population, coupled with the increasing disposable income, is forcing governments, especially in China and India, to invest heavily in infrastructure development. Investments in smart city projects have also increased over time, in countries such as Spain, the U.A.E., Singapore, India, China, and Austria. For instance, the government of Dubai (U.A.E.) launched a strategy to transform Dubai into a smart city, which includes over 100 initiatives for the development of civil infrastructure, transport, and communications. This rise in infrastructure development projects around the world has been a major driver for the growth of the LED lighting market.
The LED lighting market is highly fragmented in nature, with the presence of numerous local and regional players, such as General Electric Company, Signify N.V., Hubbell Incorporated, OSRAM Licht AG, and Cree Inc.
In recent years, players in the LED lighting industry have launched several new and advanced products to stay ahead of their competitors. For instance:
The LED lighting market report offers comprehensive market segmentation analysis along with market estimation for the period 2014–2030.
Based on Product Type
Based on Installation Type
Based on Application