Originally published on Technavio:Global Automotive Lighting Market Analysis - APAC, Europe, North America, South America, Middle East and Africa - US, China, Japan, India, Germany - Size and Forecast 2023-2027

Automotive Lighting Market Forecast 2023-2027

The forecast for the automotive lighting market anticipates an increase of USD 14.41 billion between 2022 and 2027, with an accelerated Compound Annual Growth Rate (CAGR) of 9.79%. In 2017, China dominated with the largest market share, projecting an annual revenue of USD 8.29 billion.

Market Analysis

The widespread adoption of LED lighting propels market growth. Initially limited to luxury cars due to their high cost, LED headlamps have become a focal point for automotive manufacturers. With standardized modules and technological advancements like glare-free adaptive drive beams (ADB), LED headlamps have enhanced performance. The declining cost of LED lamps and their energy efficiency further boosts their use in both luxury and mid-range vehicles. This shift to LED technology in exterior lighting presents promising growth opportunities for industry vendors.

Market Segment Trends

The OEM segment demonstrated a gradual increase in market share from USD 19.35 billion in 2017, continuing to grow by 2021. The luxury car segment primarily contributes to the interior market, driven by increased demand for luxury cars, especially in developing economies. Technological innovations and safety features, integrated with infotainment systems and ambient lighting as brand differentiators, are expected to intensify market growth. The passenger cars segment, driven by the increasing adoption of sport utility vehicles (SUVs), will be a primary driver of global market growth.

APAC Holds a Prominent Position in the Market

APAC is estimated to contribute 58% to the global market's growth during the forecast period. Consistent growth in the APAC market is expected due to the increased demand for LED lighting systems and the rise in automotive production in the region. The surge in demand for SUVs and the sales of luxury vehicles further contribute to market growth in APAC. Additionally, the region experiences a rising demand for Electric Vehicles (EVs), driven by incentives from governing bodies and the establishment of EV charging infrastructure. Stringent emission norms are anticipated to boost EV demand in APAC, creating revenue opportunities for market companies during the forecast period.

Automotive Lighting Market Companies Overview

The market exhibits a fragmented nature, with significant players including FLEX N GATE Corp, General Electric Co., Hyundai Motor Group, Koito Manufacturing Co. Ltd, and Koninklijke Philips NV.

Market Analyst Overview

The market is a dynamic sector within the global economy, undergoing significant transformations accelerated by factors like the coronavirus pandemic, evolving market trends, and the increasing demand for electric vehicles. Vehicle manufacturers prioritize advanced lighting technologies, shifting from traditional lights to energy-efficient options like LED lights. This transition is driven by the desire for enhanced durability, life, and strength—key attributes associated with light-emitting diodes (LEDs). Partnerships in the automotive industry, exemplified by the incorporation of smart LEDs, micro-LEDs, and laser-based lighting, are shaping the future of lighting technologies, offering features like 3D light patterns, area backlighting, and hidden-until-lit effects. This evolution extends to various aspects, including cabin lights, reading lamps, and ambient interior lighting systems, impacting both luxury-class vehicles like the Touareg SUV and low-cost vehicles catering to the disposable incomes of middle-class consumers.

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The market dynamics also encompass safety considerations, with the rise of adaptive lighting systems and sophisticated safety measures. Governments influence the industry through regulations focusing on visibility, on-road safety, and the reduction of traffic accidents. The growth trajectory of the Automotive market is intricately tied to the integration of innovative technologies, addressing concerns like energy consumption, production costs, and the adoption of materials such as Indium gallium nitride and Aluminum gallium indium phosphide. As the automotive sector embraces projector technology and lighting technology, the future promises an illuminated journey with enhanced safety and advanced lighting solutions.

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