Lighting Reps Talk LEDs (to Analyst Firm)

Piper Jaffray, as part of what some stock-market analysts DO, spoke recently about LEDs to 11 “lighting agents” — lighting reps, the guys and gals with whom electrical contractors come into contact all of the time.

One of them was David Shiller. I get his e-mail newsletter (which is a valuable thing). He provided a link to the PJ report, a PDF. If you download it, you’ll wanna read just the first 2-3 pages. Among other interesting pieces:

• Overall lighting sales are flat in 2012, but LED sales are up 20% to 30%

• That increase — in dollars — is coming despite a steady drop in LED prices. So the unit volume has gotta be up more, obviously, than 20%-30%.

• “Agents tell us that most of this demand [for LEDs] comes from commercial retrofit projects.”

EleBlog note: The PJ analysis states that the lighting reps aren’t seeing sales growth in line with the growth in construction spending (the “put-in-place” numbers from the U.S. government). This is attributed to:

(a) most construction spending is new construction, lighting goes in last, so the projects haven’t gotten to the lighting part yet

(b) “most lighting sales go into the retrofit market”

(c) residential’s embrace of LEDs is far from bone-crushing at this time.

Problems with this include:

1 – it’s not clear that the “put in place” spending tracked by the government does not include RETROFITS. The government data do not break out New Construction vs. Renovation. It’s just not there. For all anyone knows, much of the “put in place” increase is retrofits, not new construction.

2 – If you trouble to check, the government’s numbers through July 2012 (7 months) show a pick-up — vs. 2011′s first 7 months — show an increase of more than $42 billion in nonresidential construction spending.

BUT (and it’s a big butt) — Of that, more than $20 billion came in Power + Manufacturing construction. Lighting just isn’t a big deal in these two niches — which together make up half the nonres gain.

BOTTOM LINE (for the EleBlog, anyway) — the PJ analyst(s) are to be lauded for talking to the people who live where the rubber meets the road — the lighting reps. But a quick click over to the Census website could have told them why the lighting rebound does not match the boost in nonresidential construction spending . . .

 

 

Source: http://electricalcontractor.com/?p=6259

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