Worldwide Market Share of 80% for LED Illumination by Year 2020
The LED lighting market is expected to reach a market share of 80 percent by the year 2020.
LED technology is rapidly gaining in value and preference over traditional lighting methods due to steady cost reductions and constant improvements in LED lighting performance, along with growing knowledge and understanding of the significant benefits of using LED illumination technology.
Former CEO of Phillips Lighting, Ludo Carnotensis, recently stated that 80% market share due to the competitive global scenario of LED technology is highly plausible. Whereas the LED industry's share was just over 10% in 2012, it is already expected to more than double with up to 25% of the market share in 2014.
Paradigm Shift of the Lighting Industry
The exponential increase in demand, stability and dependency of high-tech LED lighting products pressures traditional lighting companies due to increasing competition from worldwide LED manufacturers and upstream wholesale suppliers and technology solution providers primarily based in Asia.
Although the lighting industry has remained relatively stable over the past century, with key-players remaining in their stable positions, the recent competitive market of LED technology points towards a crucial paradigm shift of the entire lighting and illumination industry.
With the emergence of many new LED manufacturers and companies all over the world, older lighting companies are being pushed back and are experiencing increasing pressure to remain in the leading positions. This, however, is more and more unlikely in future, with the number of new and innovative, high-quality LED suppliers entering the market over the past years.
Lowering Prices of LED Lighting is Key
With increasing collective understanding of the importance and benefits of sustainable LED lighting technologies, a growing number of customers worldwide are enthusiastic about upgrading to LED lighting technologies.
The only hurdle for achieving high volumes of orders for LED companies seems to be the relatively high cost when compared to traditional, non-sustainable lighting models.
For this reason, prices of wholesale LED lighting products have been on the decrease over the past months and experts are working hard to optimize light emitting diodes in order to enhance brightness and to ensure that as few chips as possible are needed to manufacture each LED lighting product.
As the science of LED technology advances and the competition on the market rises, LED manufacturers are aware that increasing sales volumes is only possible when lowering prices for the consumers and are therefore installing high-grade production techniques to ensure efficiency at low costs.
China's Leading Role in the LED Industry
As global demand for LED lighting technologies rises rapidly every year, Chinese manufacturers are realizing their vast potential in exporting products to the global market.
A primary reason for China's advantage for LED manufacturing and exporting is that light emitting diodes use rare earth materials in order to convert light emission from LED chips to a different wavelength spectrum.
LED manufacturing therefore depends heavily on the supply of these rare-earth elements which gives China a position of power when it comes to LED lighting exports.
With China as the predominant supplier of these rare earth elements, it is currently controlling its exports in order to conserve scarce resources. These restrictions on export give China a significant trade advantage when it comes to LED products. As LED manufacturers worldwide try hard to lower the prices in order to overcome the cost barrier of the past, China is rising to a highly advantageous position in the global LED market.