Market Size of Air Conditioning Equipment Industry
Study Period | 2019 - 2029 |
Market Size (2024) | USD 119.36 Billion |
Market Size (2029) | USD 154.65 Billion |
CAGR (2024 - 2029) | 5.32 % |
Fastest Growing Market | Asia-Pacific |
Largest Market | North America |
Major Players*Disclaimer: Major Players sorted in no particular order |
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Air Conditioning Equipment Market Analysis
The Air Conditioning Equipment Market size is estimated at USD 119.36 billion in 2024, and is expected to reach USD 154.65 billion by 2029, growing at a CAGR of 5.32% during the forecast period (2024-2029).
An air conditioner extracts heat from a space and expells it outside, cooling indoor air. This cooled air is then circulated throughout a building via ventilation. Air conditioners are crucial in maintaining comfortable living temperatures as a pivotal HVAC system component.
Commonly referred to as "split systems," air conditioners consist of an outdoor unit, the condenser, and an indoor unit, the evaporator. Dehumidification occurs as warm indoor air moves over the cold evaporator, causing the air to condense and shed moisture, akin to how condensation forms on chilled glass. While split systems feature distinct indoor and outdoor units, there's also a "packaged" system where elements are integrated into a single outdoor unit.
- The growing construction sector is expected to boost the demand for AC equipment in the residential, commercial, and industrial sectors. The increasing construction spending and a surge in building permits across residential, commercial, and industrial sectors. Notably, the US construction sector is set for further growth, supported by significant federal investments in infrastructure. This positive trend isn't limited to public projects; private commercial construction is also gaining momentum.
- Rapid urbanization and economic expansion, especially in developing nations, are fueling a surge in residential and commercial construction, driving the demand for air conditioning systems. With increasing incomes, a growing number of households and businesses can now invest in and deploy air conditioning units.
- The escalation of global temperatures due to climate change has heightened the frequency and intensity of heatwaves worldwide. Consequently, there has been a surge in the demand for air conditioning systems. This demand is particularly pronounced in regions that historically had lower cooling needs.
- Air conditioning is significantly more prevalent in American households than in European ones. This trend is largely attributed to the climatic demands of specific US regions.
- For instance, the humid South and arid Southwest have historically necessitated cooling solutions. Highlighting the severity of the situation, the IEA has noted a rise in heat alerts in the Southwestern United States, underscoring the health risks. Moreover, central and southern US regions, known for their high humidity, exhibit a higher prevalence of air conditioning. Conversely, the Midwest, characterized by a mixed-humid climate and annual precipitation exceeding 20 inches, also sees a notable uptake in air conditioner usage.
- The air conditioning equipment market faced substantial disruptions due to the Russia-Ukraine conflict and an economic slowdown. Rising inflation and interest rates curbed consumer spending, dampening demand and stalling market growth. Additionally, the trade tensions between the United States and China exacerbated global supply chain disruptions, significantly affecting AC manufacturers in both nations.
Air Conditioning Equipment Industry Segmentation
Air conditioning equipment is designed to regulate temperatures and provide fresh air in rooms experiencing high temperatures and humidity, ensuring a comfortable indoor environment. The market study analyses the trends and opportunities for different types of air conditioning equipment, such as split systems, variable refrigerant flow, air handling units, chillers, fan coils, indoor packaged, and rooftops used in various end-user industry applications. Further, the study analyzes the impact of macroeconomic factors on the market.
The air conditioning equipment market is segmented by type (split system [ducted and ductless], variable refrigerant flow (VRF), air handling units, chillers, fan coils, indoor packaged and rooftops, and other types), end-user industry (residential, commercial, and industrial), and geography (North America, Asia-Pacific, Europe, Latin America, and Middle East and Africa). The report offers market forecasts and size in value (USD) for all the above segments.
By Type | |
Split System (Ducted and Ductless) | |
Variable Refrigerant Flow (VRF) | |
Air Handling Units | |
Chillers | |
Fan Coils | |
Indoor Packaged and Roof Tops | |
Other Types |
By End-user Industry | |
Residential | |
Commercial | |
Industrial |
By Geography*** | |
North America | |
Asia | |
Australia and New Zealand | |
Europe | |
Latin America | |
Middle East and Africa |
Air Conditioning Equipment Market Size Summary
The air conditioning equipment market is poised for significant growth, driven by factors such as urbanization, economic development, and climate change. As global temperatures rise, the demand for air conditioning systems is increasing, particularly in regions that historically had lower cooling needs. The market is characterized by the prevalence of split systems, which consist of separate indoor and outdoor units, and packaged systems, where components are integrated into a single unit. The construction sector's expansion, supported by federal investments and private commercial projects, is further propelling the demand for air conditioning equipment across residential, commercial, and industrial sectors. The market landscape is competitive, with major players like Mitsubishi Electric, Johnson Controls, and Daikin Industries actively engaging in strategies such as mergers, acquisitions, and product launches to enhance their market presence.
In North America, the air conditioning equipment market is robust, with a high penetration rate in households, particularly in the southern and southwestern regions due to climatic demands. The market is also influenced by technological advancements and the need for energy-efficient solutions to mitigate environmental impact. The introduction of innovative products, such as LG's Energy Manager and Midea's R290 units, highlights the industry's focus on energy efficiency and user comfort. Despite challenges like supply chain disruptions and economic slowdowns, the market is expected to expand, offering opportunities for new entrants and existing players to strengthen their positions. The ongoing shift towards eco-friendly refrigerants and energy-efficient systems is anticipated to drive further growth and sustainability in the market.
Air Conditioning Equipment Market Size - Table of Contents
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1. MARKET INSIGHTS
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1.1 Market Overview
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1.2 Industry Attractiveness - Porter's Five Forces Analysis
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1.2.1 Bargaining Power of Suppliers
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1.2.2 Bargaining Power of Buyers
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1.2.3 Threat of New Entrants
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1.2.4 Threat of Substitutes
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1.2.5 Intensity of Competitive Rivalry
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1.3 Industry Value Chain Analysis
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1.4 Assessment of Macroeconomic Factors on the Market
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2. MARKET SEGMENTATION
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2.1 By Type
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2.1.1 Split System (Ducted and Ductless)
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2.1.2 Variable Refrigerant Flow (VRF)
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2.1.3 Air Handling Units
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2.1.4 Chillers
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2.1.5 Fan Coils
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2.1.6 Indoor Packaged and Roof Tops
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2.1.7 Other Types
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2.2 By End-user Industry
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2.2.1 Residential
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2.2.2 Commercial
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2.2.3 Industrial
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2.3 By Geography***
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2.3.1 North America
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2.3.2 Asia
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2.3.3 Australia and New Zealand
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2.3.4 Europe
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2.3.5 Latin America
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2.3.6 Middle East and Africa
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Air Conditioning Equipment Market Size FAQs
How big is the Air Conditioning Equipment Market?
The Air Conditioning Equipment Market size is expected to reach USD 119.36 billion in 2024 and grow at a CAGR of 5.32% to reach USD 154.65 billion by 2029.
What is the current Air Conditioning Equipment Market size?
In 2024, the Air Conditioning Equipment Market size is expected to reach USD 119.36 billion.