LED Pricing Expected to Come Down
December 5, 2011 - 9:27pm
Global competition will continue improvements in cost per lumen for solid-state lighting, say experts.
Lighting Science Group's 60W A19 equivalent under $15 represents an important milestone in pricing.
Experts anticipate the price of LEDs will come down in the near future, thanks to better technology and increased competition, which they hope will pave the way for more widespread consumer adoption. Terry McGowan, Director of Engineering and Technology for the American Lighting Assn. (ALA), says the competition for these products is substantial. “Traditional light bulbs have had only four or five global manufacturers, but for LEDs, that number is in the dozens,” McGowan says. “Competition is fierce with everyone vying for market share and that has a tendency to cut prices.” Julian Carey, Director of Marketing at Intematix, an LED component supplier, agrees that competition is a major factor, even beyond lighting. “There’s so much more competition with how much equipment and facilities are being built, particularly in South Korea and China, and it’s being driven by the display industry and flat panel TVs,” Carey says. “That’s driven a lot of capacity that’s now influencing lighting, and in as soon as two years, we should have pretty compelling value propositions for consumers on LED products.” All of this focus on LEDs has also led to some major improvements in LED technology, which has also affected cost. “The trends in cost-per-lumen direction are extremely favorable for consumers, because there are a couple major things going on,” Carey says. “We have an incredible technology road map that keeps advancing ... and with improved efficiency, you’re automatically reducing cost per lumen.” All in all, cost is still an issue at the moment, but the future looks promising. “Prices are on trend to go down as the market builds,” McGowan says. “I don’t see cost as a long-term barrier for LEDs, but it is always on the table. Right now, the consumer is saying it’s too expensive, and I do think we’ll face that for several years to come.”
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