1. World LED Lighting Markets (2015 Update)
LED Lighting will go Mainstream in 2015 and be a Fully Established Global
Market by 2019
MAA8-19
May 2015
2. 2MAA8-19
Contents
Section Page
Executive Summary 3
Market Overview 11
Total LED Lighting Market ---
• Drivers and Restraints 22
• Forecasts and Trends 32
• Competitive Analysis 46
LED Lighting Market—A Macro to Micro Analysis 51
North America Breakdown 55
Europe Breakdown 64
Asia-Pacific Breakdown 73
Middle East and Africa Breakdown 82
Latin America Breakdown 90
The Last Word 98
Appendix 101
4. 4MAA8-19
• The global LED lighting market was worth $32,285 million in 2014, having grown by 34.9%
compared with 2013. It was the second consecutive boom year, confirming the
breakthrough in the key regions of Europe, North America, and China.
• The main drivers for LED lighting came largely on the back of government decisions, such
as bans of inefficient lighting by the European Union, the United States, and Canada, and
the Chinese government’s decision to adopt LED ahead of its planned ban. It was further
supported by initiatives such as the rebates offered by utilities in the United States.
• Government initiatives, however, will play a decreasing role over the forecast period. 2014
brought LED lighting mainstream—awareness is very high, and LED products are available
widely and at different price levels.
• Pricing is key to further adoption, especially in applications less prone to total cost of
ownership (TCO) calculations.
• In 2014, the largest applications for LED were residential, outdoor, architectural, and retail.
Except for architectural, which pioneered LED lighting, the applications have been the
winners of the 2013–14 boom.
• The fastest-growing applications in the 2014–19 period are expected to be industrial, office,
and hospitality. Industrial in particular will grow from a low base, while adoption in the large
office space will increase outside of the headquarters/representative buildings that were
more of the architectural adopters.
Key Findings
Source: Frost & Sullivan
5. 5MAA8-19
Key Findings (continued)
• The flexibility of LED lighting will provide demand for controls, both in the form of LED
drivers and lighting management systems, offering the full spectrum of personalisation. The
retail sector is increasingly relying on this product integration. Low penetration in the large
residential sector is set to increase over the forecast period.
• Standardisation is a key issue that will need to be solved over the forecast period. The
success of Zhaga products might help with compatibility of products from different
manufacturers. New legal requirements and stronger enforcement of laws and standards
already in place are also expected in key regions. Lighting Europe, the industry
association, periodically calls for more control on noncompliant LED imports from Asia.
• Penetration in large applications will require tailor-made solutions and new products. The
level of research and development (R&D) required is very high, and it is expected that many
lighting companies, especially in the fixture market, will not be able to fund this LED drive
and will leave the market.
• At the same time, new small, local entrants focused on LED solutions and close to their
target customer base will provide a new form of competition to the large, global participants.
• Philips Lighting, Osram, and GE Lighting are all determined to make the most of their LED
know-how, and look at different ways to compensate the disappearance of their
replacement bulbs market component. R&D and new product development have been
limited to LED for years, and by the end of 2014 both Philips and Osram achieved 40% of
their turnover through LED. Source: Frost & Sullivan
6. 6MAA8-19
Compound
Annual Growth
Rate
16.8%
(CAGR, 2014–2019)
Market
Concentration
16.7%
(% of market share held by top
2 companies)
Market Engineering Measurements
Market Stage
Growth
Average Price
Per LED
Lightsource
$12.4
Market Size for
Last Year of
Study Period
$70,100 M
(2019)
Customer Price
Sensitivity
7
(scale:1 [low] to 10 [high])
Degree of
Technical
Change
9
(scale:1 [low] to 10 [high])
Market Revenue
$32,285 M
(2014)
Total LED Lighting Market: Market Engineering Measurements, Global, 2014
Base Year
Market Growth
Rate
34.9%
For a tabular version, click here.
Stable IncreasingDecreasing
Note: All figures are rounded. The base year is 2014. Source: Frost & Sullivan
Market Overview
(2014)
7. 7MAA8-19
Replacement
Rate
15–22 years
(average period of unit
replacement)
Average
Product
Development
Time
9–12
months
Number of
Companies that
Exited*
10
(2014)
Number of
Companies that
Entered*
30
(2014)
Number of
Competitors
5,000
(active market competitors in
2014)
Market Engineering Measurements (continued)
Competitor Overview Total Addressable Market
Industry Advancement
Marketing
Spend as a
Percent of
Market Revenue
5.0%
Average R&D
Spend as a
Percent of
Market Revenue
7.6%
*Note: Companies with revenue of more than $50.0 MStable IncreasingDecreasing
Note: All figures are rounded. The base year is 2014. Source: Frost & Sullivan
8. 8MAA8-19
Executive Summary—CEO’s Perspective
2
LED replacement lamps are already at a
price point that successfully challenge
traditional technologies and will take over
that market completely by 2020.
3
The challenge is to offer noncommoditised
products that make the most of digital LED
light advantages. LED drivers and lighting
management services will be key.
4
The market for luminaires will be particularly
challenged, as LED requires new knowledge
and expensive R&D. Concentration in this
very fragmented market is expected.
5
New markets for services and solution
designs open up, but require good contacts
and customer knowledge, which might favour
local companies above global participants.
1
The LED revolution has happened, driven by
Europe, North America, and China. Further
growth will be less centralised and will
challenge the leading global participants.
Source: Frost & Sullivan
9. 9MAA8-19
3 Big Predictions
2
The LED revolution will sweep away hundreds of fixture companies that cannot cope with the
new competencies and R&D needed. There is a chance for large LED lightsource
manufacturers to save good, medium-size fixture companies by providing the LED know-how in
return for their help in reaching local customers and winning project-based business together.
3
Lighting as a service (LaaS) on cloud-based networks for efficient and personalised
management of applications will pave the way for connected lighting and living, and better
energy and facility management. Financing, leasing, and maintenance are other service models
that will evolve around LaaS.
1
The LED replacement lamp is the winner in the medium term, as it progressively replaces
traditional technologies around the world. The entire market for replacement lamps (the cash
cow of the top companies) is, however, doomed in the long term as next-generation fixtures will
not have a lamp socket.
Source: Frost & Sullivan
10. 10MAA8-19
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Source: Frost & Sullivan
