Market research, 02 December 2024
The Air Conditioners Market is projected to reach $231.3 billion by 2029, at a CAGR of 5.4% during the forecast period of 2022–2029. Based on volume, the global air conditioners market is projected to reach 882.1 million units by 2029, at a CAGR of 6.1% during the forecast period. The growth of this market is mainly driven by the factors such as soaring temperatures & humidity levels across the world, consumers’ growing inclination toward convenience & comfort, and the rising demand for energy-efficient air conditioners. In addition, the rising adoption of air conditioners with inverter & air purification technologies and technological advancements in HVAC systems are expected to offer significant opportunities for the growth of this market. Connected air conditioners and solar photovoltaic (PV) & solar thermal-assisted air conditioning systems are major trends in this market. However, air conditioners’ high energy use is a challenge for market growth. The high costs of air conditioners restrain the growth of the global air conditioners market.
The COVID-19 pandemic impacted the worldwide economy. Many air conditioner manufacturers were under immense pressure due to the COVID-19 pandemic. Currently, most countries have shifted their focus from responding to the pandemic to economic recovery; hence, various growth opportunities are expected to emerge for the players operating in the air conditioners market due to the surging demand for energy-efficient air conditioners. According to Heating Air-conditioning & Refrigeration Distributors International (U.S.), the average distributor saw a 19% decline in sales between April 2019 and April 2020.
Only a few businesses were willing to spend on HVAC projects during the lockdown. The loss of jobs also impacted consumers’ spending behavior. HVAC businesses experienced demand fluctuations as contractors could not enter people’s homes for sales and installation due to social distancing guidelines. This decreased the demand and sales of HVAC products. Also, the disruption of supply chains impacted contracting, distribution, warehousing, and manufacturing companies.
During the pandemic, medical facilities required clean, fresh air to keep people healthy, sustaining the demand for HVAC equipment. With most people vaccinated now, customers are willing to spend on HVAC products and allow contractors and technicians to enter their homes and workplaces to complete the required installations or repairs. As supply chains are recovering and the demand for HVAC services continues to rise, companies are looking to invest in HVAC projects.
Several leading players in the air conditioners market were eying this health crisis as a new opportunity for restructuring and revisiting their existing strategies along with the development of an advanced product portfolio. For instance, in 2020, Daikin Industries, Ltd. (Japan) partnered with WASSHA Inc. (Tanzania) to establish a new company Baridi Baridi Inc., to conduct an air conditioner subscription business and build service networks. In 2020, Blue Star Ltd. (India) launched a new range of premium-yet-affordable residential air conditioners to provide consumers with high-quality ACs at attractive prices. In another instance, in 2020, Fujitsu Limited launched its first air conditioner to expand its heating and cooling product portfolio in North America. The company also launched AIRSTAGE J and V Series of Commercial Multi Split Air Conditioners to expand its commercial air conditioner business in Europe.
Air conditioners are extremely energy-intensive. High AC loads further increase power usage, intensifying the need for power generation & distribution capacities. These factors place a burden on energy infrastructure. Hence, the demand for energy-efficient air conditioning systems is on the rise. Market players are collaborating with public sector organizations to provide energy-efficient products. For instance, in 2022, Carrier Global Corporation (U.S.) collaborated with Gallipolis City School District (U.S.) to design and install a multi-building HVAC solution to boost indoor air quality (IAQ) and energy efficiency. The average energy efficiency of air conditioners is expected to double by the end of 2050. The European Union (EU) and Japan have estimated that global energy demand from air conditioners is expected to triple by the end of 2050, requiring new electricity capacity equal to the combined electricity capacity of the United States. The global stock of air conditioners in buildings is expected to increase to 5.13 billion by 2050, up from 1.6 billion in 2022, which amounts to 10 new ACs sold every second for the next 30 years. Thus, there is a rising demand for energy-efficient air conditioners to cut energy costs and reduce strain on energy infrastructure, which is driving the growth of the global air conditioners market.
Based on type, the air conditioners market is broadly segmented into window ACs, split ACs, VRF systems, centralized/ducted ACs, and other conditioner types. In 2022, the split ACs segment is expected to account for the largest share of the global air conditioners market. Split ACs are more energy efficient, lower power consumption by using less energy, and help to keep the environment clean. The large market share of this segment is mainly attributed to the growing demand for energy-saving air conditioners and lower noise levels.
However, the centralized/ducted ACs segment is projected to register the highest CAGR during the forecasted period. The rising demand for energy-efficient and sustainable ducted air conditioning systems in developing countries is responsible for the fast growth of the centralized/ducted ACs segment.
Based on tonnage, the air conditioners market is broadly segmented into up to 2 ton, 2 ton to 5 ton, 5 ton to 10 ton, and more than 10 ton. In 2022, the up to 2 ton segment is expected to account for the largest share of the global air conditioners market. The large market share of this segment is mainly attributed to the growing demand for custom features for small homes or office spaces and the rising demand for up to 2 ton air conditioners across emerging economies.
However, in 2022, the 2 ton to 5 ton segment is projected to register the highest CAGR of 6.1% during the forecast period. The growing adoption of large-sized rooms and the growing demand for ductable air conditioners are responsible for the fast growth of the 2 ton to 5 ton segment.
Based on geography, the market is segmented into North America, Europe, Asia-Pacific, Latin America, and the Middle East & Africa. During the forecast period, Asia-Pacific is projected to register the highest CAGR due to the increasing construction activities across residential and commercial infrastructure, rising initiatives by leading AC providers to launch AC products at affordable prices, increasing installations of AC products in emerging economies, rising demand for air conditioners to build efficient food cold supply chain, growing demand for residential construction, and the advent of environmental regulations for energy-efficient cooling systems.
The report includes a competitive landscape based on an extensive assessment of the key growth strategies adopted by the leading market participants in the air conditioners market between 2020 and 2022. The key players profiled in the air conditioners market report are Daikin Industries, Ltd. (Japan), Mitsubishi Electric Corporation (Japan), Hitachi-Johnson Controls Air Conditioning (Japan), Carrier Global Corporation (U.S.), Whirlpool Corporation (U.S.), Haier Smart Home Co. Ltd. (China), LG Electronics (South Korea), Voltas Limited (India), Panasonic Corporation (Japan), Robert Bosch GmbH (Germany), Samsung Electronics Co., Ltd. (South Korea), Fujitsu Limited (Japan), Blue Star Ltd (India), Toshiba Corporation (Japan), Electrolux (Sweden), Gree Electric Appliances Inc. (China), Midea Group Co. Ltd (China), and American Standard Companies Inc. (U.S.).
