The Global LED Materials Market size is forecast to reach $20 billion by 2025, after growing at a CAGR of 9% during 2020-2025. Due to rapid industrialization across the world, the demand for LED materials are surging globally. Increasing number of R & D activities of LED materials in many regions is one of the key drivers for the growth of the global LED Materials market share during the forecast period. Besides, expanding utilization of customer merchandise and expanding use of LED materials in areas like healthcare, aerospace, automobile and others over the globe due to its durability will support the development of the global LED materials market industry globally. Furthermore, the growing demand for environment-friendly vehicle is also driving the growth of LED Materials market size during the forecast period.
Product Type - Segment Analysis
The substrate material segment holds the largest share of more than 30% in the LED Materials market in 2019 and is projected to grow at a substantial rate over the forecast period. This growth is due to the growing uses of silicon based LED across TVs and handheld device displays, aviation lighting, automotive lighting, advertising and general lighting, and medical devices. Furthermore, growing demand for silicon-based die attach adhesives and optically reflective materials for industrial applications due to its excellent photo and thermal stability characteristics also drives the demand for substrate material based LED materials over the forecast period.
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Application - Segment Analysis
The automotive lighting segment is projected to grow at a highest CAGR of around 12% in the LED Materials market during the forecast period. This growth is attributed to the growing uses of LED materials in the electric vehicles. Furthermore, the growing trends of interior and exterior lightings in automotive is e also contributing for the growth of this segment during the forecast period. Additionally, as the life of LED lighting used in exterior automotive applications is increased, it has gathered better share of the automotive lighting market.
Geography - Segment Analysis
Among the regions, the APAC region holds the largest share of more than 35% in 2019 and is projected to witness the highest CAGR of around 11% in the global LED Materials market followed by North America and Europe during the forecast period. The growing building and construction and increased disposable income of the countries such as China and India is driving the growth of this market in the APAC region. For instance, according to the Chinese government report, the construction sector across the country is projected to witness a growth of 5.9% and 6.1% during years 2019 and 2020 respectively. Furthermore, the growing development of aviation sector in China and India is also accelerating the growth of LED Materials market share in APAC region during the forecast period.
Drivers – LED Materials Market
Growing demand for energy saving lightings
The use of LED materials based lighting offers various advantages over incandescent light sources such as lower energy consumption, longer lifetime, improved physical robustness, smaller size, and faster switching. Hence, due to these features, the demand for LED material based lighting is growing across various end-use sectors including residential, commercial, and industrial. Furthermore, LED lighting is a highly energy efficient lighting technology and having the potential to fundamentally change the future of lighting globally. For example, according to the Energy Saver report, the use of LED lighting can use at least 25%-75% less energy, and last 3-25 times longer, than incandescent lighting. Furthermore, along with energy saving the lifespan of LED lighting is more than that of the other light sources that makes LED lighting as the energy and cost saving lighting product, which in turn drives the demand for LED material based lighting products.
Government subsidies in developing countries increases LED consumption
Light-emitting diodes (LEDs) offers various benefits in terms of price, durability, and energy saving. So, by knowing these benefits, governments of the respective emerging nations such as China, India, Brazil, Argentina, and Mexico are focusing on reducing energy costs by implementing and developing energy-efficient devices. For instance, in May 2015, the Government of India (GoI) launched the Unnat Jyoti by Affordable LEDs for All (UJALA) scheme with a target of replacing 77 crore incandescent lamps with LED bulbs. Furthermore, the government has subsidized LED bulbs in order increase energy conservation. Whereas, in year 2013, according to the World Bank report, in India, the per capita consumption of an electric power was 765 KWh, which was close to a 25% of the global average of 3,104 KWh. Whereas, the per capita consumption of electricity in China was reached from 2,944 KWh in year 2010 to 3,762 KWh in 2013. Besides, according to the National Energy Administration (NEA) in China, in 2016, the country accounted for the largest share in terms of total energy consumed. This growth of per capita consumption of non-LED lighting has accelerated the demand for LED material based lightings due to various befits over non-LED.
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Challenges – LED Materials Market
Unstable economy and decline in automobile sales
The growing trade war between the two largest economies includes the US and China, along with geopolitical tensions, global trade tensions, and global macroeconomic performance as a whole are the factors responsible for the current unstable economic conditions. The unstable economy is considered as a challenge for the growth of this market. Furthermore, in 2020, the ongoing outbreak of COVID-19 pandemic affecting lives, businesses, individuals, and industries. The rapid spread of this pandemic disease has had a major impact on global LED materials markets due to the lockdown and drastically falling demand from developed and developing nations across various industries such as automotive, aviation, manufacturing, and construction. Besides, the decline in the sale of passenger and commercial vehicles globally in 2019 acts as a restraining factor for the growth of this market. Additionally, the ban imposed by various countries such as China, UK, Germany, the US, France, Italy, Spain, and others on the diesel vehicles will implement by 2025 and 2030 also hampering the growth of this market.
Market Landscape
Technology launches, acquisitions and R&D activities are key strategies adopted by players in the LED Materials market report. In 2019, the market of LED Materials top 10 companies accounting for xx% of the share. Major players in the LED Materials Market outlook are Nichia Corporation, Addison Engineering, Inc.Epistar Corporation, Koninklijke Philips N.V., OSRAM Licht AG, Epigan NV, LG Innotek, II-VI incorporated, China Crystal Technologies Co., Ltd, AkzoNobel (Netherlands), and Seoul Semiconductors Co, Ltd, Six Point Materials, Inc., Xinxiang Shenzhou Crystal Technology Co., Ltd among others.
Acquisitions/Technology Launches
In March 2017, Cree, Inc., launched a new generation of LED XLamp XHP70.2 LED product that produced 9 percent more lumen and 18 percent advanced lumens/watt than that of the former generation XHP70 LED. The innovative LED help to enhance an optical control for lighting applications.
Key Takeaways
In the North America region, in 2019, the US was a major market for the LED Materials owing to growing uses as an outdoor lighting across the country.
The growing popularity of silicone-based LED packaging materials for manufacturing of many high-brightness LED devices and economically viable technologies is likely to aid in the market growth of global LED Materials industry.
The outbreak of COVID-19 is projected to lower the growth of the global LED Materials market at a reasonable rate during the forecast period due to global lockdown, disruption of global supply network, lack of available of workforce, and declining demand from end-users.
The alternatives available for LED Materials such as laser diode, sodium vapour lights, and florescent tubes is acts as a restraining factor to the growth of this market.
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