The growth is driven by the increased lighting system content per vehicle and a strong adoption of LED-based front lighting systems, with headlamp and Day Running Light (DRL) systems representing 43% and 28% of total 2015 revenues, respectively. Rear combination lights/center high-mounted signal lights, interior lights, and side turn-signal lights comprised the remaining 29%.
Looking further out in the future, the market research company sees more integration of new lighting technologies such as OLED and laser, the development of Advanced Front Lighting Systems (AFLS) and other security functions, and lighting being increasingly used as a new design feature (think reconfigurable patterns).
Since their first commercialization in 2008 on luxury cars like the V10 Audi R8, full LED headlamps have since then penetrated the C-segment vehicle market in 2012, and are now being commercialized in emerging markets. Today, nearly all Tier-1s have developed full LED-based headlamp systems.
The first commercial car (BMW i8) with laser-based headlamps was unveiled in fall 2014 while the first commercial car (BMW M4 GTS) with OLED-based Rear Combination Light (RCL) was unveiled in fall 2015. Laser-based headlamps could enable long-distance night vision (up to 600m) while the adoption of OLED in RCL is a good fit to move from 2D to 3D light source designs, thanks to OLEDs being thin, bendable, and large emitting surface sources.
However, Yole notes that both technologies have price and technological issues that must still be solved in order to match automotive OEM requirements like reliability and lifetime.
Integration of these new semiconductor/electronic-based components is also enabling the realization of full electronic systems (i.e. Solid State Light + sensor + software), and by extension the development of advanced lighting functionalities.
This could translate into smart beam patterns that automatically adjust to the driving environment. More recently, the use of matrix LED systems combined with camera and image processing functions has allowed for the creation of new lighting functions like adaptive front lighting and glare-free lighting. However, these combinations make the development of such systems more difficult, and require the development of new know-how. Indeed, reliable and dynamic systems induce strong expertise in domains like lighting, thermal management, sensor, and data processing.
Laser and OLED lighting could change the market landscape with new companies challenging the top five industry players. Indeed, while 2015 was dominated by Koito (JP), Magneti Marelli (IT), Valeo (FR), Hella (DE), and Stanley (JP), holding 80% of the all automotive lighting revenues, emerging companies developing new laser-based or OLED-based lighting systems, including Advanced Front Lighting Systems (AFLS) with the integration of new components such as cameras and sensors, requiring a new set of competencies such as image processing (for AFLS).
In its report, Yole pinpoints some emerging players – Xingyu (CN), Olsa (IT), Ta Yih (CN), and Grupo Antolin (ES) already exhibiting a growth rate nearly double the total market’s average of +5.4%).
To effectively differentiate from market leaders and gain additional market share, these players mainly focus on innovative systems and/or lower-cost solutions and/or emerging markets like China.
These new technologies and functionalities could push OEMs to be closer to device/component developers (i.e. Tier-2s and Tier-3s) and new suppliers – the consequence being that they will probably bypass more and more Tier-1s for development and production, thus creating a new supply/value chain, observes Yole.
OEMs can work directly with Tier-2s or Tier-3s for laser lighting applications and optical engineering. This allows an OEM complete control of developments, and mastery of associated technologies.
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