Escalating LED adoption to change the lamp market dynamics, paradigm shift to be observed in the competitive hierarchy
Published Date: June 14, 2017 Author: Satarupa De
The lamp industry, of late, has been gaining renewed attention, subject to the fact that it is witnessing an inflection point with the sharp rise in the urban population growth curve. New commercial opportunities are emerging as the business landscape is being redrawn. It has been observed that general lighting standardizations initiated by renowned regulatory bodies to enable carbon dioxide abatement is a crucial factor favoring this change. Global economic growth, which is slated to register an annual growth rate of 3% to 4% over 2014-2050, is leaving a direct impact on the lamp market. The overall lamp industry has observed a paradigm shift in its outlook from traditional lighting technologies to new energy competent fixture installations such as LEDs and CFLs. A recent LED lamp market analysis forecasts that Asia is currently leading the industry in terms of the huge transition to LED lamps, especially in the general lighting sector. At the same time, climatic changes and resource scarcity are turning out to be an increasing concern for the global lamp Industry.
Statistics depict that global lamp market will collect a revenue of USD 18 billion by 2024. A large number of megatrends are underlining this massive expansion, out of which three are of prime importance. The first one is the macroeconomic condition, that is influencing robust constructional activities across the world and consequently demanding new lighting installations. The second position is held by spreading energy efficiency awareness and regulations that define the product portfolio for the future. The third trend includes the increasing mandatory roll outs by some of the governmental bodies to limit the non-renewable energy sources owing to their continuous depletion over the last few years - nuclear power being at the pinnacle. Since the second and third factor are highly interwoven, the combined impact is expected to boost the commercialization of energy efficient lighting products based markets, LED lamp industry being one of the majorly influenced sectors. China, for instance, has recently passed a legislation banning the deployment of incandescent lamps in the utility sector.
An overview of lamp market based on the application landscape
Residential applications represent a major portion of the indoor lamp market. The accelerated uptake of the product deployment in the domestic sector can be credited to the growing consumer inclination toward energy-efficient lighting products in the household. Nowadays, people are readily adopting hi-tech lighting approaches to optimize the power consumption of lights inside the house. Alongside, the regulations initiated by some of the emerging governments such as those of Europe and China to phase out incandescent lamps are further shedding a positive light on the overall growth prospect of the market.
Commercial domain application which already accounts for a significant share of the overall lamp industry, is anticipated to cover around 55% of the market share by 2020. This sector is characterized by the extensive utilization of fluorescent technology, as high-rise office buildings mostly prefer warm, down-light type of lighting sources.
In the mid-range to high-end hospitals, generally, warm lights such as halogens and incandescent bulbs are deployed to obtain the required disability and color quality for various critical surgeries. While in lower end hospital applications, LFLs (linear fluorescent lamp) are used. LFLs and HID based lamp market have an upper hand in the industrial segment as well.
Global lamp Industry is experiencing an unfortunate downturn in the outdoor sector. The technological shift toward LEDs for outdoor lighting purposes is acting as a deterrent for the growth of this market. Outdoor lightings are mostly installed at considerable heights where LEDs provide a competitive advantage over other incandescent bulbs. However, high-intensity discharge lamp Industry will give a tough competition to the LED lamp market as far as high-end lighting applications such as stadium lighting is concerned, where HID upholds a strong advantage.
Accelerated regulatory intervention worldwide is heavily influencing the overall lamp industry:
The governments of various countries across the globe are taking initiatives in this field based on two dimensions - banning of inefficient lighting technologies and enforcing stringent legislations pertaining to the implementation of more energy efficient technologies. The Chinese government has recently passed a proclamation which prohibits the usage of incandescent lamps in the residential and commercial sectors. This initiation is also backed by China’s energy conservation law. Concurrently, Europe is extending regulations to switch over to more energy efficient lighting sources. According to a recent forecast by EU, all new building infrastructure in Europe by 2020 will consume nearly zero energy. The German government has also implemented a fundamental shift in the energy policy by committing to nuclear free energy production by 2022. In addition to regulatory initiations, global campaigns have also helped in generating awareness regarding energy efficient lighting technologies among the masses, thereby changing the outlook of lamp market. A prominent example of this is the initiative by the UNEP (United Nations Environmental Program) which was established with a sole purpose of transforming the lighting industry by deploying environmentally sustainable lighting technologies.
Dynamic industrial environment
The transformative outlook toward the incorporation of environmentally sustainable lighting technologies is leaving an influential impact on the overall business landscape. New opportunities are expected to emerge as lamp market changes the course of its growth path. An evident byproduct of this transformation is the recent global adoption of lighting control systems across varied utility domains. While the corporate sector is the largest professional arena deploying these control panels, expansion is anticipated in outdoor and residential sectors as well, over the years ahead. Service related businesses related to maintenance, financial services, and technical solutions merely represent the beginning of the new lighting arena. The migration of global lamp Industry toward LEDs is triggering more pronounced discontinuity in the traditional lighting industry structure. Market investors and prominent industry players are analyzing their business position in the value chain and consequently upgrading themselves to sustain in the fragmented lamp industry.
Global Market Insights, Inc. has a report titled “Lamp Market Size By Product (Electrical Discharge [Fluorescent, High Intensity Discharge], Filament [Incandescent, Halogen]), By Application (Indoor [Residential, Commercial, Retail, Hospitality, Healthcare], Industrial), Outdoor [Highways, Public Places], Motor Vehicles), Industry Analysis Report, Regional Outlook (U.S., Canada, Germany, UK, France, Italy, Russia, China, India, Vietnam, Indonesia, Thailand, Brazil, Mexico) Application Potential, Price Trends, Competitive Market Share & Forecast, 2017 – 2024” available at https://www.gminsights.com/industry-analysis/lamp-market