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LED Lighting Market Overview
The global light-emitting diode (LED) market was valued at $30,500.8 million in 2016, and is projected to advance at a CAGR of 12.6% during the forecast period (2017–2023). The growing adoption of energy-efficient lighting solutions across the globe is one of the primary factors attributing to the growth of the market. Apart from this, increasing demand for LED lights for various applications, such as indoor lighting, outdoor lighting, automotive, and architectural, is also benefited the market growth.
Based on product type, the LED lighting market is classified into luminaire and lamp. Cost of lamp replacement is much less as compared to removing and replacing a luminaire. On account of this, the luminaire category contributed larger revenue to the market in 2016, and is also expected to exhibit higher growth during the forecast period.
GLOBAL LED LIGHTING MARKET SPLIT, BY END-USE APPLICATION, MILLION UNITS (2013 – 2023)
On the basis of installation type, the LED lighting market is categorized into new installation and retrofit. Of these, the new installation category held larger market share in 2016. Surging demand for energy-efficient lighting sources and declining manufacturing cost of LEDs, coupled with electrification in rural areas, across the globe are some of the major factors that are likely to spearhead the growth of the market for new installations, during the forecast period. On the other hand, the market for retrofit LEDs is projected to register higher CAGR, of 16.3%, during the forecast period.
Based on application, the LED lighting market is classified into indoor lighting and outdoor lighting. The indoor lighting category contributed larger revenue to the market, owing to their various application areas, such as residential, commercial, and industrial lighting. The commercial lighting is further classified into office lighting, retail malls, and hospitality. Among the application areas, the residential category contributed the largest revenue to the indoor LED lighting market, attributed to the low-power consumption and long lifecycle of LED lighting solutions.
Globally, the APAC LED lighting market contributed the largest revenue share in 2016, and is also expected to witness the fastest growth during 2017–2023, owing to the increasing government initiatives to support the usage of energy-efficient lighting sources and the surging focus on the electrification in rural areas.
LED Lighting Market Dynamics
Decreasing cost of LED lights is one of the major factors driving their adoption across several applications, including residential, commercial, and architectural lighting. Key players operating in the LED lighting market, including Osram, Sylvania, and Philips, are looking forward to reduce their price by a significant margin. According to the U.S. Department of Energy (DOE), lighting-energy consumption in the country is expected to reduce by 15% in 2020 and by 40% in 2030 by using LED lights, saving about $26 billion at today's electricity prices. This is expected to drive the adoption of LED lights during the forecast period.
Lack of awareness regarding new installations of LED lighting solutions and large payback period of the installation have led to the slow adoption of LED lighting solutions, globally. Awareness level of the total installation cost, payback period of LED lights, return on investment (ROI), and energy savings among consumers is low, majorly in countries such as India, Saudi Arabia, the U.A.E., Indonesia, and Canada. Due to this, the consumers use either traditional lighting solutions or other low-cost energy efficient lighting sources, such as CFLs and plasma lamps. This is likely to hinder the growth of the LED lighting market.
LED Lighting Market Competitive Landscape
The global LED lighting market is highly competitive in nature, primarily due to presence of a large number of original equipment manufacturers (OEMs) in emerging markets, such as China, India, Indonesia, and Brazil. Some of the key companies operating in the market include Philips Lighting Holding B.V., General Electric, OSRAM Licht AG, Cree Inc., Eaton Corporation PLC, Virtual Extension, Dialight PLC, Zumtobel Group AG, Samsung Group, and Syska LED.
Key Questions Answered in the Report