Air Conditioning System Market

Global Air Conditioning System Market:

The global air conditioning system market size reached US$ 118.0 Billion in 2023. Looking forward, IMARC Group expects the market to reach US$ 193.0 Billion by 2032, exhibiting a growth rate (CAGR) of 5.4% during 2024-2032. The rising temperatures, elevating levels of urbanization, stringent energy efficiency regulations, significant technological advancements, and increasing disposable income levels are some of the key factors driving the market growth.

Global Air Conditioning System Market Analysis:

• Major Market Drivers: The increasing demand for cooling solutions in residential, commercial, and industrial sectors, increasing global temperatures, and elevating lifestyles of individuals are some of the key factors propelling the air conditioning system market demand.
• Key Market Trends: Rapid technological advancements have been pivotal in shaping the market. Energy-efficient systems, smart thermostats, and eco-friendly refrigerants are gaining prominence, addressing environmental concerns while enhancing performance.
• Geographical Trends: The Asia-Pacific region dominates the market, with rapid urbanization, rising temperatures, and increasing middle-class population, driving the product demand. Countries such as, China and India, are witnessing a rise in demand for air conditioning systems, in residential spaces and also in commercial and industrial sectors.
• Competitive Landscape: Some of the leading companies operating in the global market are Carrier Global Corporation, DAIKIN INDUSTRIES, Ltd., Electrolux North America, Inc., Haier Group Corporation, Hitachi-Johnson Controls Air Conditioning Inc., Lennox International Inc., LG Electronics Inc., Midea Group Co., Ltd., Mitsubishi Electric Corporation, Panasonic Corporation, and Samsung Electronics Co. Ltd., among others.
• Challenges and Opportunities: Challenges include environmental concerns, regulations related to refrigerants, and increasing energy consumption. Opportunities arise from the growing demand for energy-efficient and eco-friendly systems, along with emerging markets in developing countries.
   

Air Conditioning System Market Trends:

Rising Global Temperatures

The increasing global temperatures due to climate change are significantly driving the air conditioning system market. As average temperatures continue to rise, especially in regions such as the Middle East, Asia-Pacific, and North America, the demand for cooling solutions has increased. For instance, climate change has an unrelenting effect in India. During summer, in the northern regions of the country, temperatures pass the 50 degrees Celsius mark. Temperatures in the Indian summer over the last decade or so have repeatedly broken heat records, and there is no sign of respite from heat waves in the foreseeable future, making air conditioning an increasingly important fixture in Indian homes. Similarly, Middle East warming is almost two times faster than other inhabited parts of the world. Moreover, extreme heatwaves have become more frequent, prompting governments and individuals to invest in cooling solutions for both residential and commercial spaces.

Increasing Demand for Energy-efficient Air Conditioners

The increasing demand for energy-efficient air conditioning (AC) systems is driven by environmental concerns and the desire to reduce energy consumption and utility costs. In response to this, various key market players are introducing ACs that are highly energy-efficient and sustainable. For instance, in April 2024, LG Electronics India celebrated their record-breaking sales in Q1 by introducing their flagship feature range, which includes the Energy Manager and ArtCool Air Conditioners. The introduction of the Energy Manager feature marks a significant milestone in LG’s commitment to sustainability and consumer empowerment. This cutting-edge feature allows users to define their energy usage preferences and periods, leveraging Wi-Fi connectivity to optimize compressor usage and minimize energy consumption effortlessly. Besides this, the governments of various countries are focusing on efficient air conditioning, which is positively impacting the air conditioning system market outlook. For instance, Energy Efficiency Services Limited (EESL), a joint venture of four Public Sector Enterprises under the administrative control of the Ministry of Power, Government of India, announced the launch of the Super-Efficient Air Conditioning program. The program is aimed at promoting the use of energy-efficient technologies and bringing about a reduction in energy consumption. 

Rapid Urbanization and Infrastructure Development

The increasing construction of both residential and commercial establishments and the elevating levels of urbanization are further catalyzing the air conditioning system industry. Furthermore, the rising population, which is anticipated to positively influence the residential and commercial constructions is also expected to increase demand for air conditioning systems. For instance, the rising population in Gulf countries is expected to contribute significantly to construction spending. The regional population is estimated to reach over 600 million by 2050, from 350 million in 2015. This is likely to propel growth in construction activities in the infrastructure and building sector, particularly education, housing, and healthcare infrastructure. Moreover, according to a data report, 44% of the world lived in cities, 43% in towns and suburbs, and 13% in rural areas in 2020. The rise in infrastructure development is projected to propel the air conditioning system market size in the coming years.

Global Air Conditioning System Market Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the market, along with forecasts at the global, regional, and country levels for 2024-2032. Our report has categorized the market based on product type, distribution channel, technology, and end use.

Breakup by Product Type:

• Unitary
• Rooftop
• PTAC
• Others
   

Unitary air conditioning (UAC) accounts for the majority of the market share

The report has provided a detailed breakup and analysis of the market based on the product type. This includes unitary, rooftop, PTAC, and others. According to the air conditioning system market report, unitary air conditioning represented the largest segment.

Unitary air conditioning systems are a prominent segment of the global market. These systems, often referred to as split or ducted systems, are widely used in both residential and commercial applications. They are known for their versatility, as they can be installed in single rooms or multiple zones, offering individualized temperature control. In the residential sector, unitary systems are favored for their quiet operation, energy efficiency, and ease of installation. In commercial applications, they are commonly used in small to medium-sized offices, retail spaces, and restaurants. The rise in the number of residential construction projects and expanding food and restaurant chains across the globe are anticipated to propel the air conditioning system market share in the coming years. For instance, home sales volume in seven major Indian cities accelerated by 113% year-on-year in the third quarter of 2021.

Breakup by Distribution Channel:

• Specialty Stores
• Supermarkets and Hypermarkets
• Online
• Others
   

Specialty stores holds the largest share in the industry

A detailed breakup and analysis of the market based on the distribution channel have also been provided in the report. This includes specialty stores, supermarkets and hypermarkets, online, and others. According to the report, specialty stores accounted for the largest market share.

Specialty stores have traditionally been a key distribution channel for air conditioning systems. These stores specialize in home appliances and HVAC (Heating, Ventilation, and Air Conditioning) products, offering a wide range of air conditioning units to consumers. One of the advantages of specialty stores is their expertise and knowledgeable staff who can assist consumers in choosing the right system for their needs. Consumers often visit these stores when they require personalized advice, installation services, or product demonstrations. Moreover, specialty stores provide a showroom-like experience, allowing consumers to physically inspect and test air conditioning units before making a purchase decision. This hands-on experience can be crucial when investing in a significant home appliance such as an air conditioner.

Breakup by Technology:

• Inverter
• Non-inverter
   

Inverter represents the leading market segment

The report has provided a detailed breakup and analysis of the market based on technology. This includes inverter and non-inverter. According to the report, inverter represented the largest segment.

Inverter technology has been a game-changer in the air conditioning industry, revolutionizing the way cooling systems operate. Inverter air conditioning systems use variable-speed compressors that can adjust their speed based on the cooling load rather than cycling on and off, such as traditional non-inverter systems. This results in several advantages that have driven the adoption of inverter technology. Moreover, inverter air conditioners are highly energy efficient. As a result, various key market players are increasingly developing and introducing new and improved variants of inverter air conditioners. For instance, in February 2024, Elista introduced a new range of air conditioners in India, offering an impressive indoor cooling experience with the 4-in-1 convertible, Inverter AC, & Fixed speed AC range. This range is equipped with Turbo Cool Power Chill mode, advanced Blue Fin Technology, 100% copper-made condensers, C-shaped evaporator design, Inverter Technology, stabilizer-free operation, and an ultra-modern chipset.

Breakup by End Use:

• Residential
• Commercial
• Industrial
   

Commercial represents the leading market segment

The report has provided a detailed breakup and analysis of the market based on the end use. This includes residential, commercial, and industrial. According to the report, the commercial sector represented the largest segment.

The commercial segment of the air conditioning system market caters to various non-residential spaces, including offices, retail stores, hotels, restaurants, educational institutions, and healthcare facilities. The air conditioning system market research report by IMARC indicates that the increasing number of commercial properties is primarily driving the market for this segment. For instance, in March 2022, 144.7 million square feet of office space were under construction in the United States, accounting for 2.2% of total stock. Furthermore, 93% of the space is Class A or A+, indicating that businesses are continuing to prioritize high-quality projects to retain their workforce. As businesses continue to adapt to evolving consumer preferences and regulations concerning indoor air quality, the commercial segment of the air conditioning market is poised for moderate growth.

Breakup by Region:

• North America
  • United States
  • Canada
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Indonesia
  • Others
• Europe
  • Germany
  • France
  • United Kingdom
  • Italy
  • Spain
  • Russia
  • Others
• Latin America
  • Brazil
  • Mexico
  • Others
• Middle East and Africa
   

Asia Pacific leads the market, accounting for the largest air conditioning system market share

The market research report has also provided a comprehensive analysis of all the major regional markets, which include North America (the United States and Canada); Europe (Germany, France, the United Kingdom, Italy, Spain, Russia and others); Asia Pacific (China, Japan, India, South Korea, Australia, Indonesia, and others); Latin America (Brazil, Mexico, and others); and the Middle East and Africa. According to the report, Asia Pacific accounted for the largest market share.

The Asia Pacific region is the dominant force in the global air conditioning system market. This dynamic market is characterized by rapid urbanization, rising temperatures, and a growing middle-class population with increasing disposable incomes. Countries, such as China and India, are witnessing a rise in demand for air conditioning systems in residential spaces and also in commercial and industrial sectors. Furthermore, the elevating temperatures in some countries of the APAC region are increasing the demand for cooling solutions like air conditioning systems. For instance, climate change has an unrelenting effect in India. During summer, in the northern regions of the country, temperatures pass the 50 degrees Celsius mark. Temperatures in the Indian summer over the last decade or so have repeatedly broken heat records, and there is no sign of respite from heat waves in the foreseeable future, making air conditioning an increasingly important fixture in Indian homes.

Leading Key Players in the Air Conditioning System Industry:

The market research report has provided a comprehensive analysis of the competitive landscape. Detailed profiles of all major companies have also been provided. Some of the key players in the market include:

• Carrier Global Corporation
• DAIKIN INDUSTRIES, Ltd.
• Electrolux North America, Inc.
• Haier Group Corporation
• Hitachi-Johnson Controls Air Conditioning Inc.
• Lennox International Inc.
• LG Electronics Inc.
• Midea Group Co., Ltd.
• Mitsubishi Electric Corporation
• Panasonic Corporation
• Samsung Electronics Co. Ltd.
   

(Please note that this is only a partial list of the key players, and the complete list is provided in the report.)

Global Air Conditioning System Market Latest News:

• April 2024: Haier Appliances India announced the launch of its latest range of “super heavy-duty” air conditioners. The new range comes with the company’s Hexa Inverter and Supersonic cooling technologies.
• February 2024: Elista introduced a new range of air conditioners in India, offering an impressive indoor cooling experience with the 4-in-1 convertible, Inverter AC & Fixed speed AC range. This range is equipped with Turbo Cool Power Chill mode, advanced Blue Fin Technology, 100% copper made condensers, C-Shaped evaporator design, Inverter Technology, stabilizer-free operation, and ultra-modern chipset.
• December 2023: Panasonic Life Solutions India (PLSIND) introduced India's First Matter-enabled room air conditioners. Matter is an open-source connectivity standard that facilitates smooth interoperability among smart devices.

Global Air Conditioning System Market Report Scope:

Key Benefits for Stakeholders:

• IMARC’s industry report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the air conditioning system market from 2018-2032.
• The research report provides the latest information on the market drivers, challenges, and opportunities in the global air conditioning system market.
• The study maps the leading, as well as the fastest-growing, regional markets. It further enables stakeholders to identify the key country-level markets within each region.
• Porter's five forces analysis assists stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the air conditioning system industry and its attractiveness.
• The competitive landscape allows stakeholders to understand their competitive environment and provides insight into the current positions of key players in the market.