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The general lighting market is estimated to grow at a CAGR of 6.97% between 2022 and 2027. The size of the market is forecast to increase by USD 50.7 billion. The growth of the market depends on several factors, including the declining manufacturing cost of LEDs, the growing adoption of energy-efficient lighting technologies, and the growing demand for LEDs from the automotive sector.
This report extensively covers product (LED lighting and traditional lighting), application (residential, commercial, outdoor, industrial, and others), and geography (APAC, North America, Europe, Middle East and Africa, and South America). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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The declining manufacturing cost of LEDs is notably driving the general lighting market growth, although factors such as the high average cost per LED fixture may impede the market growth. Our researchers studied the data for years, with 2022 as the base year and 2023 as the estimated year, and presented the key drivers, trends, and challenges for the market. Although there has been a decrease in demand for the market during the COVID-19 pandemic, a holistic analysis of drivers will help companies refine marketing strategies to gain a competitive advantage.
The declining manufacturing cost of LEDs is notably driving the general lighting market growth. LED production costs have declined substantially due to government subsidies for the procurement of semiconductor equipment, such as metal-organic chemical vapour deposition (MOCVD) equipment, which is used in the manufacture of LEDs. As a result, LED lighting product manufacturers have increased their LED production capacity. Furthermore, government assistance has aided vendors in lowering the variable costs involved with production by operating their manufacturing facilities at full capacity. Another major factor is the shift toward larger-diameter sapphire substrates, which are used to produce LED chips. Earlier, 2-4-inch wafers were commonly used in the production of LED chips. However, the recent move to 6-8-inch wafers has enabled manufacturers to generate more LED chips per wafer, lowering production costs. As the price wars in the LED market intensify, producers will increasingly focus on cost-saving and the usage of large-diameter sapphire wafers for LED production. This will accelerate the production of LEDs as the manufacture of large wafers allows suppliers to produce more chips per wafer. This is expected to result in a further decline in the ASP of LEDs. The declining ASP of LEDs will accelerate the adoption of LED lighting across all application segments.
A growing number of households and urbanization is the primary trend driving the general lighting market growth. Urbanization around the globe, particularly in emerging economies, is driving up demand for lighting systems from an expanding number of households. The residential segment is a key contributor to the increasing demand for lighting devices. The increase in urbanization will result in a growing number of households worldwide, thereby driving the installation of new lamps and luminaires. This will lead to an increase in the unit shipments and revenue of general lighting products. According to the World Bank, China accounted for an urban population of nearly 57% in 2020. It is also observing a high growth in the urban middle-class population, which is expected to account for more than 75% of the total population by 2022. The general lighting market in China will observe high growth because of the increasing demand for luxury homes and high-class residential societies. This is expected to accelerate the demand for LED lamps and luminaires. Brazil is becoming a popular destination among commercial business entities. This is leading to rapid urbanization in many areas of Brazil, including Rio de Janeiro and Sao Paulo. According to World Bank data, Brazil accounted for an urban population of close to 86% in 2020. This is expected to increase the demand for residential and commercial buildings, such as shopping malls and office spaces, thereby contributing to the growth of residential and commercial lighting.
The high average cost per LED fixture may impede the general lighting market growth. Though the total cost of owning LED lamps and fixtures is low compared with traditional incandescent and halogen bulbs, the high initial cost acts as a hindrance. The total cost of installation includes the cost of LED luminaires and labor costs. In addition, consumers who install smart lighting fixtures require a huge amount of money to set up the Internet of Things (IoT) infrastructure. The price of incorporating smart bulbs in a fixture also varies depending on the bulb type and manufacturer. The price of products from major smart LED bulb manufacturers costs $15- $180, hindering the growth of the market in focus further during the forecast period.
Our analysis of the Life Cycle of the market indicates a movement from the innovator’s stage to the laggard’s stage. The report illustrates the lifecycle of the market, focusing on the adoption rates of the major countries including the US, China, Japan, Germany, and the UK. Technavio has included key purchase criteria, adoption rates, adoption lifecycles, and drivers of price sensitivity to help companies evaluate and develop growth strategies from 2022 to 2027.
Global General Lighting Market Customer Landscape
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market
Signify NV - Through the digital solutions segment, the company offers luminaires, lighting systems, and services related to the Internet of Things to customers in the professional segment. the company's key offerings include general lighting through the Interact and Philips brands.
We also have detailed analyses of the market’s competitive landscape and offer information on 20 market vendors, including :
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market share growth by the LED lighting segment will be significant during the forecast period. The LED lighting products segment is expected to be the largest segment of the market in focus during the forecast period. Earlier, traditional lighting sources, such as CFLs, LFLs, and HID lamps, were used across all application segments because of their low price and ease of installation. The demand for intelligent lighting systems in industrial facilities, the economic benefits of LED lamps over LFLs and CFLs in commercial applications (retail outlets and offices), and the focus on conserving electricity and reducing the carbon footprint have compelled government and local municipalities and consumers across the globe to adopt energy-efficient and eco-friendly lighting systems such as LED lighting products.
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The LED lighting segment showed a gradual increase in market share from USD 54.30 billion in 2017 and continued to grow by 2021. Governments of various countries worldwide are banning the use of traditional lighting products and promoting the use of LED lighting. LED lights are preferred over other lights, such as incandescent lamps and CFLs, because of their enhanced energy efficiency. LEDs consume up to 75% less energy than other bulbs and have a longer lifespan, which is 60,000 hours compared with 1,500 hours for incandescent bulbs and 8,000 hours for CFLs. LEDs are also called green lighting systems because of their energy-saving features. All these factors result in the growing demand for LED lights, thus spurring the growth of the global general lighting market during the period forecasted. Furthermore, our report provides a brief analysis of the historical and forecast market share and their segment along with their reasons for growth from 2017 to 2027.
The growth of this segment is primarily attributed to the increasing adoption of general lighting products by residential consumers, which is driven by an increase in the global demand for the general lighting industry.
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APAC is projected to contribute 44% by 2027. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
The general lighting market in APAC is growing at a rapid rate, primarily because of the increased demand for lighting solutions from the residential and commercial segments. The region is becoming a hub for industries such as retail, hospitality, and healthcare. Many multinational companies are setting up their offices in the region. The increasing urbanization and growth in IT infrastructure are leading to the development of smart infrastructure in several countries in the region, including India, China, Japan, and others, accelerating further the demand for efficient lighting solutions. In addition, developing countries, such as China and India, will see many international events being organized during the forecast period. For instance, the 13th edition of the ICC men's Cricket World Cup (CWC) will be held in several cities throughout India in October and November 2023. The holding of such mega-events is expected to drive the demand for general lighting solutions, thereby fostering the growth of the general lighting market in APAC during the forecast period.
In 2020, the outbreak of COVID-19 led to a decline in demand for general lighting products in APAC. The rising cases of COVID-19 forced governments in China, India, Japan, and other countries to impose nationwide lockdowns to contain the spread of the disease in 2020. It led many end-user industries, including automotive, hospitality, power, mining, construction, and others, to shut down their facilities temporarily. Also, the outbreak of the COVID-19 pandemic compelled people in this region to stay indoors in 2020, resulting in commercial spaces such as malls and pubs, restaurants, and office spaces to shut down completely or working with a reduced workforce. Therefore, the growth of the general lighting market in APAC was adversely impacted by the pandemic in 2020. However, in 2021, the successful vaccination campaigns conducted across APAC led to the reopening of general lighting manufacturing facilities across APAC. As a result of these factors, the general lighting market in APAC is expected to grow during the forecast period.
Brazil General Lighting market - The market share will grow at a CAGR of 13.82% over the period 2014-2019.
BRIC Countries General Lighting market - The market share will grow at a CAGR of 12.45% over the period 2014-2019.
China General Lighting market - The market share will grow at a CAGR of 10.81% over the period 2014-2019.
North America General Lighting market - The market share will grow at a CAGR of 2.67% during the period 2014-2019.
Our report forecasts revenue growth at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
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General Lighting Market Scope |
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Report Coverage |
Details |
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Page number |
161 |
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Base year |
2022 |
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Historical year |
2017-2021 |
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Forecast period |
2023-2027 |
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Growth momentum & CAGR |
Accelerate at a CAGR of 6.97% |
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Market growth 2023-2027 |
USD 50.7 billion |
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Market structure |
Fragmented |
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YoY growth (%) |
6.71 |
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Regional analysis |
APAC, Europe, North America, the Middle East and Africa, and South America |
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Performing market contribution |
APAC at 44% |
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Key consumer countries |
US, China, Japan, Germany, and UK |
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Competitive landscape |
Leading companies, Competitive Strategies, Consumer engagement scope |
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Key companies profiled |
Acuity Brands Inc., Advanced Lighting Technologies LLC, Bridgelux Inc., Citizen Watch Co. of America Inc., Cree Lighting, Delta Electronics Inc., Dialight Plc, Eaton Corp. Plc, General Electric Co., Hafele America Co., Hubbell Inc., Lumens Co. Ltd, OSRAM GmbH, Panasonic Holdings Corp., Philips International BV, Schneider Electric SE, Selux AG, Signify NV, Wipro Ltd., and Zumtobel Group AG |
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Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
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Customization purview |
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1 Drivers, Challenges, and Trends
Research Framework
Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key industry influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.
INFORMATION SOURCES
Primary sources
Secondary sources
DATA ANALYSIS
Data Synthesis
Data Validation
REPORT WRITING
Qualitative
Quantitative
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