Outdoor Lighting Market

• High demand for Outdoor LED lighting is driving the market growth

Market CAGR for outdoor lighting is driven by the rising demand for outdoor LED lighting. In addition to warehouses and other locations, LED lighting is also used in homes, businesses, and governmental structures. Throughout the world, electricity is mostly utilised to illuminate streets and other public areas in cities, towns, and villages. All lighting applications must make the paradigm change from conventional lighting systems to linked LED technology to be energy and financially viable. The extended lifespan of LED lights, in addition to their well-known energy efficiency, lowers maintenance and replacement expenses.

Government representatives in US communities pay close attention to the most recent advancements in lighting because they view it as more than just a source of illumination. Traditional light bulbs cannot reach the same results as smart lights, which may wirelessly interface with different networks to gather various forms of data such as surrounding foot traffic and even contribute to lowering crime rates. Emerging nations are becoming more interested in the LED lighting system as it fits into their plans for economic modernisation.

Moreover, governments across the globe are promoting the adoption of energy-efficient lighting is likely to favor the growth of the outdoor lighting market. For instance, in August 2022, The US federal government unveiled the Climate Smart Building Initiative, which will enhance the government's collaboration with the private sector to modernize federal buildings. This initiative includes improving on-site renewable electricity generation, providing efficient lighting, and installing electric vehicle supply infrastructure.

Further, the growing traffic has been one of the primary reasons for the development of unique highways and streets. The growing number of passenger vehicles is the primary factor for global traffic congestion, fueled by growing urbanization and rising disposable income. To decrease traffic jams on the road, governments in various countries, including the US, China, and India, strongly focus on investing in road infrastructural development.

For instance, in the US, the $3.3 billion Hampton Roads Bridge-Tunnel expansion project, such as the building of a four-lane tunnel and a widening from four to eight routes on I-64 in an area between Norfolk and Hampton, is expected to complete by 2024, which, in turn, drive the demand and utilization of highways, streets, and tunnel lightings.

The rising adoption of energy-efficient lighting solutions is driving the market growth owing to the growing government focus on promoting energy saving using energy-efficient lighting sources, predominantly LEDs. LEDs are particularly advantageous in outdoor lighting applications, as they work efficiently for long-operating hours at low- maintenance costs driving the outdoor lighting market revenue.

The rapid pace of urbanization globally appears to be a primary driver of the Global Outdoor Lighting Market Industry. As cities expand, the demand for effective outdoor lighting solutions increases to enhance safety and visibility. Urban areas are projected to house approximately 68 percent of the global population by 2050, necessitating improved infrastructure, including lighting. This trend is likely to contribute to the market's growth, with projections indicating a market value of 29.7 USD Billion in 2024, reflecting the urgent need for innovative outdoor lighting solutions in densely populated regions.

The Global Outdoor Lighting Market Industry is poised for substantial growth, with projections indicating a market value of 29.7 USD Billion in 2024 and an anticipated increase to 63.5 USD Billion by 2035. This growth trajectory suggests a compound annual growth rate (CAGR) of 7.14% from 2025 to 2035, reflecting the increasing demand for innovative outdoor lighting solutions. Factors such as urbanization, technological advancements, and sustainability initiatives are likely to contribute to this upward trend, positioning the outdoor lighting market as a dynamic sector within the broader lighting industry.

Technological innovations in outdoor lighting, such as the integration of smart lighting systems and energy-efficient LED technologies, significantly influence the Global Outdoor Lighting Market Industry. Smart lighting solutions, which allow for remote control and automation, are gaining traction among municipalities and businesses. The shift towards LED lighting, known for its longevity and reduced energy consumption, is expected to drive market growth. By 2035, the market is anticipated to reach 63.5 USD Billion, indicating a robust demand for advanced lighting technologies that enhance energy efficiency and operational effectiveness.

The global push towards developing smart cities is significantly impacting the Global Outdoor Lighting Market Industry. Smart city initiatives focus on integrating technology into urban infrastructure, including outdoor lighting systems. This integration enhances public safety, reduces energy consumption, and improves overall urban living conditions. As cities adopt smart technologies, the demand for advanced outdoor lighting solutions is expected to surge. The anticipated market growth, reaching 63.5 USD Billion by 2035, underscores the potential of smart city projects to drive innovation and investment in outdoor lighting.

A growing emphasis on sustainability and energy efficiency is reshaping the Global Outdoor Lighting Market Industry. Governments and organizations worldwide are prioritizing eco-friendly solutions to reduce carbon footprints and energy consumption. This trend is evident in various initiatives aimed at replacing traditional lighting with energy-efficient alternatives, such as LEDs. The market's compound annual growth rate (CAGR) is projected at 7.14% from 2025 to 2035, reflecting the increasing adoption of sustainable practices in outdoor lighting, which aligns with global environmental goals.

Government initiatives and regulations aimed at enhancing public safety and energy efficiency are pivotal in driving the Global Outdoor Lighting Market Industry. Many countries are implementing policies that mandate the use of energy-efficient lighting in public spaces. For instance, various municipalities are investing in smart street lighting systems that not only improve safety but also reduce energy costs. These regulatory frameworks are likely to bolster market growth, as they encourage the adoption of modern lighting solutions that comply with sustainability standards.

By region, the study provides market insights into North America, Europe, Asia-Pacific and the Rest of the World. The North American outdoor lighting market area will dominate this market, owing to the increasing trend of family conferences and dinners in outdoor spaces at residences. The growing interest in designing and supporting the backyard and front yard gardens not only expands the aesthetics of the homes but also acts as a pleasant avenue to entertain guests outdoors, driving the market in this region.

Further, the US outdoor lighting market held the largest market share, and the Canada outdoor lighting market was the fastest-growing market in the European region.

Further, the major countries studied in the market report are The US, Canada, German, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure 2: Outdoor Lighting Market SHARE BY REGION 2022 (USD Billion)

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Europe outdoor lighting market accounts for the second-largest market share due to the deployment of smart LED lighting systems in the region and increasing government initiatives regarding outdoor lighting. Further, the German outdoor lighting market held the largest market share, and the UK outdoor lighting market was the fastest-growing market in the European region.

The Asia-Pacific outdoor lighting market is expected to grow at the fastest CAGR from 2024 to 2032. This is due to increasing infrastructural activities, including smart cities in developing countries, including China, Japan, South Korea, and India. Moreover, China outdoor lighting market held the largest market share, and the India outdoor lighting market was the fastest-growing market in the Asia-Pacific region.

Leading market players are investing heavily in research and development to expand their product lines, which will help the outdoor lighting market grow even more. Market participants are also undertaking various strategic activities to expand their global footprint, with important market developments including new product launches, contractual agreements, mergers and acquisitions, higher investments, and collaboration with other organizations. To expand and survive in a more competitive and rising market climate, the outdoor lighting industry must offer cost-effective items.

Manufacturing locally to minimize operational costs is one of the key business tactics manufacturers use in the global outdoor lighting industry to benefit clients and increase the market sector. Major players in the outdoor lighting market, including Signify Holding, General Electric, OSRAM GmbH, Hubbell, ACUITY BRANDS, INC., Zumtobel Group, and others, are attempting to increase market demand by investing in research and development operations.

SMART Global Holdings Inc is a designer, developer, and developer of electronic subsystems for original equipment manufacturers confronted in the industrial, computer, networking, telecommunications, aerospace and defense markets. SGH manufactures mobile memory products for memory components, smartphones, and modules for desktops, notebooks, and servers. The company offers its customers DRAMs, flash drives, enterprise memory, and hybrid volatile and non-volatile memory solutions. It also provides customized, integrated supply chain services to OEM customers. In March 2021, SMART Global Holdings Inc. declared that it had completed its investment in Cree Inc.'s Cree LED products business unit.

Cree LED works as the Cree LED business unit of the firm for up to $300.0 million, such as fixed upfront and deferred payments and contingent consideration. The firm would leverage its track record of integrating companies, unlocking margin and revenue growth, and offering best-in-class specialty lighting solutions.

IWASAKI ELECTRIC CO., LTD. manufactures illumination lamps, including high-intensity discharge, mercury, halogen, and fluorescent lamps. The Company also produces non-illumination products such as UV sterilization Systems and water purification systems. In July 2021, Iwasaki Electric Co. Ltd. installed LEDioc LED lightbulbs in Kumamoto City, Japan parks.

With a strategy to curb power consumption all over the parks under its management, in 2020, Kumamoto City carried out a city-wide blanket advancement of all luminaires to LEDs across the 550 parks where public lighting was installed, focusing on creating a lighting environment with a relaxing and encouraging ambiance, while also effectively managing the appropriate environmental considerations.