Market size

The total industrial lighting market is estimated to be worth £50bn (source: IHS). The industrial LED lighting market, where Dialight is focused, has a 20-year retro-fit cycle. It is difficult to predict the rate of adoption over the 20-year cycle but it is not expected to be linear. (This excludes markets that Dialight does not currently serve such as China, Russia, India and Africa.)

Market penetration

The industrial lighting market is undergoing rapid transformation driven by growing adoption of LED technology and the increasing popularity of connected lighting systems. Cumulative penetration of LED lighting is 3%, thus enabling strong growth potential for some years to come.

Market share

Within the industrial market, Dialight holds the largest share with 32%. This is the same size as the next four competitors combined (source: IHS). 

Market sectors

The major market sectors in which the Group operates are:

From our signature High Bay line to our versatile Linear fixtures, Dialight offers the largest selection of rugged, cutting edge products to suit virtually any industrial application. Additionally, our controls solutions can seamlessly integrate with existing factory automation and building management systems to deliver granular control and system-wide visibility that dramatically reduces lighting energy costs by as much as 60 percent or more.

With over 40 years of industrial LED lighting experience and the largest installed base in the world, Dialight’s extensive network of support staff, distributor and channel partners can help customers select from our wide range of products
to identify a lighting solution that meets their specific needs.

The LED advantage

The clear advantages of LED technology are driving its market share gains, especially with an increasing focus on total cost of ownership:

  • Low energy consumption: LED lighting is four to five times more energy efficient than conventional technologies.
  • Long lifetime: LED lighting lasts up to 15 years, which is 4 times the lifespan of compact fluorescent lighting and 10 times the lifespan of incandescent lighting.
  • Enhanced versatility: LED lighting is smaller and more durable and comes in more colours than traditional lighting.

LEDs are revolutionising the lighting market due to their energy efficiency, lifetime, versatility, superior colour quality and ever-improving cost competitiveness. Due to the progression in the LED technology, LEDs have become a broader part of the lighting market, entering markets once held by traditional fixture products. Going forward, LED technology is expected to continue to improve, with increasing efficiency and decreasing prices as well as enabling opportunities for lighting design and energy savings.

This energy savings opportunity is driven largely by the linear fixture, outdoor, and low and high bay products. These products, characterised by high light output and long operating hours, are where increased controllability and networked capabilities will have the greatest value to customers. LEDs installed with traditional control strategies as well as connected capabilities will contribute to a significant portion of the forecast energy savings. Of the forecast annual energy savings by 2035, one-third is expected to be made possible by the penetration of connected LEDs.

Opportunities

These are some of the future opportunities that we anticipate:

  • Increased adoption rates as customers embrace the benefits of ownership.
  • Increased use of lighting controls to accelerate the adoption curve.
  • Increased customer appetite for more sustainable products.
  • Regulation which forces adoption and/or provides incentives for adoption.

Risks

These are some of the potential risks faced by the business:

  • The Group needs to develop contingency plans to counteract the financial impact of potential tariffs on imports worldwide.
  • The Group needs to maintain its market share through the continued development of market-leading products.
  • The Group needs to ensure that it anticipates customer demand in order to ensure that it produces the products that the market wants.
  • The Group needs to ensure the robustness of its supply chain in order to fulfil demand.

Regulation

The push for energy efficiency has led to regulations aimed at phasing out older, less efficient lighting technologies. Incandescent lights have been banned in most countries, with Brazil to come, and the EU has recently passed regulations to phase out halogen by 2018 with the US expected to follow suit.

The global lighting market is undergoing rapid transformation driven by growing adoption of LED technology and the increasing popularity of connected lighting systems. US regulation stipulates that lighting in most buildings must be controlled automatically to adjust light usage according to the time of day and occupancy.

In response to regulation and market trends, lighting controls have gathered momentum as a potential method of more intelligently operating lighting systems to save energy. Lighting controls, which include various dimming and sensor technologies used separately or in conjunction with other systems such as timers and daylighting, can, if used properly, yield significant energy savings, as they use feedback from the target environment to provide adequate lighting levels only when needed.