Japan's Toshiba Corp needs to consider acquisitions so as to develop sales routes and gain share overseas in the growing market for LED lights, the head of its lighting systems operations said on Thursday.

Toshiba, Japan's lead maker of high-efficiency LED (light-emitting diode) lights, is struggling to win business in the U.S. and Europe against big names General Electric Co, Philips and Siemens unit Osram.

New deals stopped overseas after the Lehman shock, in contrast with better-than-expected LED sales at home, Kuniaki Kumamaru, general manager of Toshiba's New Lighting Systems Division, said in an interview for the Reuters Global Climate and Alternative Energy Summit.

M&A would be one option to develop different sales channels.

Toshiba, which developed Japan's first light bulb in 1890, aims to raise lighting system sales to 350 billion yen ($3.8 billion) by 2015, en route to grab roughly 15 percent of what it projects to be a 7 trillion yen global market for LEDs by 2020.

The company, which is trying to expand its LED sales for cars as well as in airports, studios and offices, now holds 2 to 3 percent of the global market, which various estimates put at around $3 billion to $6 billion.

LEDs boast lower power consumption and a longer life than conventional fluorescent or incandescent lights, and demand has grown as businesses and governments seek to cut energy costs, maintenance fees and greenhouse gas emissions.

Europe began phasing out standard energy-guzzling incandescent light bulbs this month, and Japan, China and Australia have taken similar steps, promising future growth.

To win new revenue streams, the maker of MRIs, nuclear reactors and semiconductors is considering ways to encourage architects to incorporate its lights into their designs. It also plans to package its LED lights with its elevators, road and railway services and flat TVs.

But while businesses can make up their investment in pricier LEDs through lower electricity costs within less than two years, prices have to go down from the current $40 to $50 for a 100-watt bulb to around $30 to sway households, Kumamaru said.

Toshiba opened sales bases in France and the United States in April and plans to expand to Britain and Germany in October.

Toshiba now faces increasing competition at home from non-lighting makers Panasonic Corp, which said it will launch LED light bulbs in Japan on October 21, and Sharp Corp which started a price war in Japan when it launched a 3,900 yen light bulb in July.

Toshiba competes with Toyoda Gosei Co Ltd and privately held Nichia Corp and could also compete with South Korea's Samsung LED, a venture of Samsung Electronics Co, and LG Innotek.

Toshiba now plans to raise sales of its LED backlights for LCD TVs and car displays to half of its total LED sales, up from the current 20 percent.

($1=92.05 Yen)

(Reporting by Mayumi Negishi and Kentaro Hamada; Editing by Michael Watson)