Saudi Arabia Lighting Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2024 - 2030)

Saudi Arabia Lighting Market Size

Saudi Arabia Lighting Market Trends & Drivers

Integration of Voice Control Features and Adoption of Smart Lighting Systems Are the Key Market Trends

• Many voice-activated products, such as Siri, Google Now, Cortana, and the ubiquitous voice assistants by Apple, Google, and Microsoft, deliver only limited functionality and sometimes fail to understand what the user is saying.
• However, products such as Amazon’s voice-controlled Echo speaker and Apple’s upcoming HomeKit software could facilitate voice interactions with smart home devices via voice commands easily and, perhaps, help smart homes become more popular and accessible. For instance, Apple’s HomeKit enables consumers to control devices, such as locks, and lights.
• Additionally, Saudi Arabia’s ambitions to rapidly increase the adoption of smart homes and smart lighting, further support the trend of voice control features in lighting systems.
• The merging of the lighting and electronics industries because of the adoption of advanced electronic controls in lights, the adoption of voice control features and smart lighting systems, and the emergence of lighting as a service (LaaS) are the key trends being witnessed in the Saudi Arabian lighting market.

Rising Adoption of LEDs Drives the Market

• The increasing demand for energy is responsible for the rise in energy prices, light energy supplies, and growing anxiety about climate change and related liabilities. The utilization of electricity is estimated to increase by around 50% in the next 20–25 years.
• Lighting consumes most of the electricity in the residential, commercial, and industrial sectors. Lighting accounts for 15% of the total electricity consumption and 5% of the total greenhouse gas emissions.
• Therefore, using energy-efficient LED lighting is a solution to such a crisis. It is one of the major factors attributable to consumers’ shift toward smart lighting, which is helping the lighting market in the country grow at a significant rate.
• For instance, according to the International Energy Agency (IEA), smart lighting systems can save up to 35% of the energy compared to conventional lighting systems.

Development of Smart Cities and Upcoming Mega Projects

• According to the United Nations Human Settlements Program, today’s cities consume more than 75% of the world’s energy. The advent of advanced communication and digital technologies has, so far, helped address the challenges in the development of smart infrastructure.
• With the overcoming of such challenges and the use of data sharing and analysis tools, intelligent design, and smart lighting solutions, the development of smart cities is picking up to accelerate smart urbanization in the country.
• The growth in the development of smart cities has further led to an increase in the demand for lighting solutions. Since smart cities use sensors and embedded devices from streets to power meters to traffic signals, smart lighting decreases the consumption of energy to a great extent.
• Apart from this, smart city initiatives relying on open, connected technology infrastructure require streamlining operations and energy conservation to make living cheaper and more convenient.
• Therefore, through connected and multi-sensor nodes, smart lighting enables the creation of a powerful sensing network that gathers information related to the city environment, such as humidity, CO2, UVA light, and audio–video activities.
• It helps municipalities reduce energy consumption, maintain the cost of living in smart cities, reduce the electricity bills transportation agencies pay to the utilities, through energy-efficient traffic lights, and decrease the number of night accident rates through connected streetlights.
• Furthermore, there are about 4,700 construction projects in the pipeline in Saudi Arabia, with an estimated value of $852.3 billion. With more than 3,300 projects, the urban construction sector comprises nearly 70% of all such initiatives in the country, driven by the steadily rising population and urbanization rate.
• As per Deputy Crown Prince Mohammad Bin Salman Al Saud’s Kingdom’s Vision 2030 plan, Saudi Arabia would modernize the infrastructure in 285 municipalities before 2030.
• This would involve creating megacities or smart cities from scratch. Building new cities would permit energy-efficient and smart lighting technologies to be directly built into industrial, commercial, and residential spaces, which would be cheaper and less hassle-prone compared to retrofitting existing systems.

Design Challenges with LEDs

• The conventional luminaire design is created with the help of the mechanical and optical integration of the components. However, LED luminaire design requires a system design approach to integrate and balance the competing requirements of mechanics, optics, thermal management, electronics, and light generation elements.
• The LED junction temperature is kept below the manufacturer-specified levels to achieve a longer life, by following an integrated thermal management approach. To meet the LED power supply challenge, the designer needs to set the initial color, actively maintain it over time with useful feedback, and modify the output based up on the dimming input.
• Designing LEDs becomes more difficult when the designer works according to the manufacturing cost and performance tradeoffs. Such design challenges are responsible for creating hindrances in the market growth in the country.
• The lack of smart lighting standards for data presentation and color-correlated temperature (CCT) creates trouble for designers in choosing bulbs for their projects.
• The selection of bulbs becomes tough because the color temperature labeling tends to differ with the manufacturer. If the labels are misleading, lighting designers might end up facing legal charges and a damaged reputation. Proper standards are needed for sensors, infrastructure, controls, and luminaire designs, without which the software may not be able to take control properly.
• The lack of standards makes it difficult to integrate, operate, and maintain management systems for smart lighting, which is restraining the growth of the smart lighting market in the country.
• There is a need for standardization and an open-source IoT-based software platform for the development of the market.
• Additionally, customers demand extended lifetimes for smart lights, thus making component interchangeability increasingly important for the market growth in the country.

Saudi Arabia Lighting Industry Outlook

Component Insights

• In terms of component, the fixture category accounted for a larger share, of around 70%, in 2023, and it is expected to demonstrate a CAGR of 10.4% during the forecast period.
• This is because of its improved performance, low maintenance cost, and increased efficiency, and it is an ideal solution for any business looking to cut costs to increase profits.
• Whereas, in the foreseeable future, the control category is likely to showcase a higher CAGR, of 10.6%. This can be because users can control the level, quality, and characteristics of light in a specific area and reduce energy waste.

Components covered in the report include:

• Fixture (Larger Category)
• Control (Faster-Growing Category)

Technology Insight

• Based on technology, the wired category held a larger share of around 65% in 2023. This is because the use of wires is completely eliminated with wireless lighting control.
• Sensors, lights, and a central control unit communicate with the rest of the system. This facilitates the installation, addition, and removal of lighting units from the system.
• On the other hand, the wireless category is expected to witness faster growth over the forecast period. This is because users can strategically position their lights to save more energy and money when excellent wireless lighting control systems are installed in their homes or offices.
• As a result, a wireless lighting control system can support a greater range of distance than wired ones.

The following technologies are included in the report:

• Wired (Larger Category)
• Wireless (Faster-Growing Category)

Application Insight

• Based on application, the residential category held the largest share, of 40%, in 2023, and it is expected to grow at a CAGR of 10.8% during the forecast period.
• This is because Saudi Arabia is expected to experience relatively strong consumer income growth between 2024 and 2040, as the government continues to encourage the private sector and increase economic development.
• Moreover, steady economic growth is expected to increase spending on discretionary goods and services like residential lighting.

Applications covered in the report are:

• Residential (Largest Category)
• Commercial
• Industrial
• Outdoor
• Automotive (Fastest-Growing Category)

Saudi Arabia Lighting Market Share

In recent years, key players operating in the lighting market in the country have been involved in mergers and acquisitions and new product launches, to gain a competitive advantage. The growth in demand for advanced and connected indoor lighting solutions has made the players focus more on developing unique products, mainly based on the latest technology features such as cloud-based lighting services, energy-efficient lighting in industrial and commercial environments, and smartphone-enabled lighting control solutions.

Saudi Arabia Lighting Industry News

• In October 2022, Signify Saudi Arabia introduced smart home lighting Philips Hue.
• In September 2022, Signify Saudi Arabia signed an MoU with MEWA.