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European Forecasts: a roundtable with top lighting professionals
2020-06-24
by Sara Banfi, CSIL International Market Research

 


At European level, CSIL forecasts a drop of 7.1% of the lighting market. This projection is perceived as too optimistic by many industry professionals. Indeed, many companies operating in the industry expect to register a double-digit decline for 2020. It is also important to distinguish between different areas. The geographical differences regard both the impact and the responses. For example, the Nordic markets have been suffering much less than countries like the United Kingdom (hit stronger than others), Italy, and France and there is still potential for several projects. Much will depend from the second half of the year. Also the recovery projected for 2022 and 2023 may be overestimated. Only by 2023 the market will return to the same level of 2019, even with differences from market to market. In term of public funding and financing the largest stimulus will address hospitals and public administration buildings. Other initiatives regard home renovations and energy-saving interventions.

A further push to the industry will be provided by the face out of conventional lighting. Regarding education facilities, street lighting, and infrastructures, the magnitude of the public helps will depend on whether the funds for the recovery will be intended to the development of economic activities or towards investments in infrastructures. Technical lighting is projected to strongly drop in 2020, remain flat in 2021 and eventually start recovering by 2022. The hospitality and retail segments will be hardly hit by the Covid-19 crisis. The retail segment will suffer because of the Asian competition in term of prices, while for the hospitality segment the crisis could generate new opportunities. Office lighting won't register positive performance in the coming years: smart working is flourishing and the pressure coming from the Asian competitors in terms of prices is expected to remain strong. Some opportunities for the business could come from the new layout of traditional offices. Part of the office lighting sales will be absorbed by the consumer market in form of home office, which is projected to remain flat at worst but not to decline. In particular, the high-end residential segment is expected to benefit from the most of governmental support.

Uncertainty arising from the crisis is the biggest threat for the contract business, slowing down the project planning. Activities are expected to restart in 2021.

E-commerce is expected to increase its share in the coming years. Still, the performance of e-commerce varies across segments. Online sales have performed much better for the mass market rather than for the technical one. In addition, it's going to become a more and more struggling topic in the future because of the low quality of many products available online.

In term of competitive system, the process of consolidation is expected to continue especially towards the omnichannel concept. A final rumour regards UV lamps. There could be the possibility to use UV lighting for the sanitation of public areas. But it's still a question mark.

On July 7th, 2020 CSIL held a webinar on the past and future trends affecting the European market for lighting. Many leading industry professionals took part at the event, including representatives from Flos, Glamox, iGuzzini, Ledvance, Lighting Europe, SLV, and Trilux, among the others. The article is an abstract of the discussion that followed CSIL presentation: 'The European Market for Lighting Fixtures – 2020 edition' (the Report is available on our website (www.lighting.csilmilano.com)

 
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