27 June 2018

LED market rising at CAGR of 16% to $23.98bn in 2022

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The LED market is rising at a compound annual growth rate (CAGR) of more than 16% during 2018-2022, reaching $23.98bn in 2022, according to a report by market research firm Technavio. This represents an acceleration from the 10.44% year-on-year growth rate expected for 2018.

One of the major trends being seen is the growing number of households and urbanization. The increase in urbanization is driving the installation of new lamps and LED luminaires which, in turn, will lead to an increase in unit shipments and hence revenue for LED products, the report notes. In addition, rapid urbanization is driving governments of various countries to invest in large-scale urban infrastructure projects.

Another key factor contributing to growth is that LED manufacturing cost has declined since 2012 and will continue to do so during the forecast period, primarily because of the declining average selling price (ASP) of chips and components used in the manufacturing process. This is leading to a decrease in the installation costs of LED lamps and fixtures, driving the installation of new LED lamps and fixtures across all application segments.

“Megacities concentrate on investing in infrastructure development to meet the needs of the growing population,” notes a senior analyst at Technavio for research on semiconductor equipment. “These megacities consume a large amount energy, due to which governments of these countries are planning to install energy-efficient lighting sources such as LED lamps and luminaires to reduce electricity consumption. This will lead to the growth of the LED market.”

Demand for LED products is also expected to be fuelled by the high demand for energy-efficient lighting solutions in the general lighting market. This segment is expected to increase its market share by nearly 29% over the forecast period, while the backlighting segment is expected to see a significant drop in market share.

The Asia-Pacific (APAC) held the largest share of the market in 2017 (at nearly 47%), followed by the Americas and Europe, the Middle-East and Africa (EMEA) respectively. Indeed, 52% of market growth expected over 2018-2022 should come from the APAC region. APAC and the Americas are expected to see a significant increase in their market shares while EMEA will see a corresponding decrease over the forecast period, the report concludes.

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LED market growing at 18% CAGR, boosted by demand for energy-efficient lighting

Tags: LEDs Lighting market

Visit: www.technavio.com/report/global-led-market-analysis-share-2018