Market Report
LED represents 14% of all household lighting appliances
The 15th edition of Lighting Market Report – UK 2020-2024, published by AMA Research, has found that the move towards the use of LEDs has increased, with this technology estimated to represent 14% of lighting appliances owned by UK households.
P
reviously the lighting and LED report, the report has been restructured in line with the rapid growth of the LED
lighting market to become almost synonymous with the lighting market in general. The report reviews the overall lighting sector with comment on the recent performance of the market. Forecasts take into account the impact of the UK’s exit from the European Union and the disruption created by the COVID-19 pandemic.
Rapid LED adoption The key driver for the lighting market is the rapid adoption of LED lighting in both the non- domestic and domestic construction sectors. LEDs growth in market share has been underpinned by energy efficiency regulations, leading to the removal from sale of almost all incandescent lighting and most halogen lighting. LEDs now represent the majority of UK lamp sales. While the advent of LED lighting and the
retrofitting of higher-priced LED products into conventional lighting boosted market value significantly between 2015 and 2017, a sharp fall in LED prices since then has led to a decline in market size in the last two years. Construction output grew by around a quarter
between 2015 and 2019, with the residential sector and infrastructure, particularly street lighting, playing a major role in supporting lighting market growth. However, recent economic uncertainty has led to some contraction in construction output in the office and retail sectors.
The interruption of construction activity and
the broader economic impact of the COVID-19 pandemic is expected to lead to a sharp fall in the value of the UK lighting market in 2020. Beyond 2020, the prospects for the lighting market are difficult to evaluate as the speed of recovery remains uncertain. It is currently forecast that the market is expected to decline 16% in 2020, with a return to growth in 2021, increasing 12% between 2020 and 2024.
LED lamps have seen significant
improvements in light output and quality in recent years, including a wider spectrum and warmer white light, helping to boost their acceptability in the market. LEDs are a relatively ‘low tech’ product and the
barriers to market entry are low. Initially, the introduction of LED lighting provided a boost to market value as LEDs commanded a premium price compared with ‘traditional’ incandescent lamps, as well as with halogen and CFL products. However, a massive increase in supply, as new market entrants have appeared, has led to an extreme level of price deflation. The lighting market supply chain has become more fragmented with the advent of LEDs, with organisations from non-traditional lighting backgrounds, particularly those with a background in semi-conductor manufacture, entering the market. LED technology is set to become increasingly dominant in the lighting market, and is expected to be used almost universally by 2024.
Areas of particular interest within the report include: Growth of LED lamps in the commercial sector and development in the domestic replacement sector. The impact of falling LED prices on the market. Focus on energy and carbon savings driving growth of more efficient lighting solutions for key commercial sectors. Growth of connected lighting solutions in both commercial and domestic sectors Changing focus of market from individual lamps, luminaires and control products to integrated luminaires.
30 | electrical wholesalerSeptember 2020
ewnews.co.uk
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