LED Modules to Grow Faster Than Packaged LEDs
The packaged LED lighting market is forecast to reach a compound annual growth rate (CAGR) of 11.0 percent, from 2013 to 2019, while the market for LED modules used in lighting will reach a CAGR of 23.9 percent, according to the latest research note from the IHS Lighting and LEDs team.
Riding the trend toward integrated products, many LED manufacturers are increasingly turning to modules, as a way to boost revenue and profits. Chip on board and LED light engines are two examples of integrated products that are experiencing rapid growth. Cree, Seoul Semiconductor, and other LED companies - as well as Harvard, BAG, Tridonic and other power companies - are also active in the market.
"LEDs used in lighting have become commoditised in many applications, and price declines in the last three or four years have been worse than expected," said Jamie Fox, principal analyst for IHS. "With MLS and other Chinese players increasingly entering the market, competition will remain tough."
Component manufacturers are increasingly looking beyond the metrics of lumens/$ and lumens/W as competitive differentiators. LED modules and light engines are a logical step for many companies looking to improve their profit margin, diversify to ensure future stability and meet the demands of their customers.
During its research for the LED engines and light modules report, IHS found that respondents cited the shorter supply chain, ease of production, interchangeability, quality and reliability as reasons why lighting companies chose to purchase LED modules and light engines. The report assessed the supply chain and reported on a mixture of outsourcing, contract manufacturing and in house production of the products.
The combined market for LED modules and light engines in lighting applications is projected to reach $1.3 billion in 2014, according to the latest IHS "˜Next Generation Lighting" report. As well as insight into modules and light engines, the report also features analysis the emerging markets for LiFi, indoor positioning, and OLED.