Philips’ Dramatic Move Into LED Lighting

December 31, 2008

Email this story Print this post Add your comments

Royal Philips Electronics – the Dutch manufacturer known for its Magnavox televisions and Norelco shavers – is shifting its home electronics business to high-tech commercial lighting.

The move into a new industry is not unusual: Philips has been in a state of constant transformation and been buying and selling divisions for some time, writes The New York Times.

The company itself is getting smaller, with annual gross sales falling 30 percent over the past seven years to 26.8 billion euros, or about $37.5 billion. Management hopes to push it back up to the levels it was at in 2000 by capitalizing on both the green trend and the aging trend.

In the last two years, Philips has bought 16 companies, 11 of them U.S, most of which specialize in either lighting or hospital scanning and monitoring equipment.

Through the purchase of LED manufacturer Color Kinetics lighting fixtures maker Genlyte, it has secured a leading position in the market for the next generation of light bulbs.

LED bulbs (those made with light-emitting diodes) typically use one-tenth the power of traditional light bulbs and last up to 20 times as long, making them an ideal lighting source for large scale projects like commercial buildings.

An LED that replaces a $1 incandescent light bulb or a $2 compact fluorescent bulb costs about $60, so residential use is still limited, especially during an economic downturn when consumers reduce spending.

But those in emerging markets who are gaining more income may be a prime target for the product, because one of the very first things people buy in such markets is light, said Philips’ CFO, Pierre-Jean Sivignon.

In two years, at least 20 percent of Philips’ lighting sales for commercial use will come from LEDs, he said.

To that end, Philips will continue to spend heavily on LED research and development, putting about 5.2 percent of its current global lighting revenue toward the technology.

Email this story Print this post Add your comments

Advertisers

Enhance Sustainability. Improve Profitability.

Learn how at the SAP Sustainability Resource Center. >>

Unclear about the EPA's new GHG Rule?

Learn how it could affect your business. >>

EPA mandatory emissions reporting starts Jan 1st

CSA Standards can help your organization get ready for compliance. Find out how. >>

Survey Results: Product Environmental Compliance Best Practices

How to achieve compliance at a significantly lower cost. Download the full report. >>

Join the Discussion

Recent Daily News [ see all ]

11/20/2009
11/19/2009
11/18/2009

Charts [ see all ]

European Paper Industry Cuts CO2 Emissions by 42% since 1990

S. America Takes Most Urgent View of Copenhagen Talks

Nike Tops Annual Climate Action Scores

Oceans May Trap more Carbon than Forests

Jobs

View All Jobs >> Post a Job >>

Comments and Discussions

Trade Association on Trade Group on EPA Chemical Regs: ‘If Everything is a Priority, Then Nothing is a Priority’
"Seriously… that..."

Gary Markowitz on Supermarkets Tackle Emissions Reductions, Fuel Efficiency
"Supermarkets waste over 10 percent of their energy through improper..."

peter in ireland on Ontario May Follow California’s Lead on TV Energy Efficiency
"Governor Schwarzenegger is shooting himself in the foot! 1...."

Environmental Leader on S. America Takes Most Urgent View of Copenhagen Talks
"The survey respondents (the PDF report mentions 4,000 respondents in 38..."

Jake on UPS Trying New Hydraulic Hybrid Trucks
"A point of clarification: the Reuters press release referenced herein reports that 20 UPS will purchase..."

Custom Organic Shirts on S. America Takes Most Urgent View of Copenhagen Talks
"90% of North Americans believe it is urgent to get a global climate..."

peter dublin on California City’s Green Building Ordinance Applies to Commercial Buildings
"Why energy efficiebnt regulation on buildings –..."

Environmental Leader