Global Air Handling Units (AHU) Market Size and Share Analysis 2023-2028


Market Overview

An air handling unit (AHU), also known as an air handler, is a device used in heating, ventilating, and air conditioning systems to condition and circulate air. It consists of a large metal box containing a blower, heating and cooling elements, filter chambers, sound attenuators, and dampers.

The market size of Air Handling Units (AHU) is estimated to be USD 14.21 billion in 2023, and it is projected to reach USD 19.09 billion by 2028, with a CAGR of 6.08% during the forecast period (2023-2028).

Product Type

Market Research

Pages

121

Release Date

Mar-23

Base Year

2022

Forecast Period

2023-2028

Market Size

USD 13.7 billion in 2021

Market Segments

Type, End User, Region

Region

Global

No. of Companies Mentioned

10


Air handling units can be used in various locations and building types, such as shopping centers, industrial facilities, and warehouses. They are an integral part of HVAC systems that ensure proper climate control, including heating, cooling, air pressure, and air quality, to provide comfort and safety for occupants.

Air handling units are commonly employed in large facilities like shopping malls, where regulations regarding carbon dioxide exhaust and air cleanliness are stringent. These facilities require a significant amount of air intake and circulation through multiple blower fans. By delivering outside air into the rooms, air handling units reduce the number of required fans.

With the global population growing, the use of HVAC systems is becoming more prevalent. Air conditioners and electric fans already account for approximately one-fifth of total electricity consumption in buildings worldwide, or 10% of global electricity consumption, according to the IEA.

Buildings in the European Union contribute to around 40% of energy consumption and 36% of greenhouse gas emissions. HVAC systems play a significant role in energy usage in these buildings, emphasizing the importance of energy-efficient equipment like air handling units.

The HVAC equipment market, including air handler units, is heavily influenced by construction activities, government regulations, and infrastructure development initiatives. Fluctuations in the commercial and industrial sectors directly impact the demand for HVAC equipment.

The COVID-19 pandemic highlighted the importance of ventilation, driving the demand for air handling units. Studies showed that the transmission of the virus was more effective in crowded indoor spaces, such as workplaces, restaurants, and shopping centers. Ventilation with outdoor air was found to dilute contaminants and reduce exposure, further fueling market growth.

The increasing urbanization worldwide is also driving the demand for air handling units. The United Nations predicts that the global population will reach 8.5 billion by 2030 and 10.4 billion by 2100. As more people live in cities, the use of HVAC systems, including air handling units, becomes more prevalent.

Developing economies, particularly in Asia and Oceania, have experienced significant urbanization in recent years. China and India, in particular, have seen a large influx of people migrating from rural areas to cities. This has led to increased spending on housing, commercial construction, and infrastructure, creating a significant demand for HVAC system installations, including air handling units.


Market Segmentation

The market is segmented based on various factors, including type, end user, and region.

Segmentation by Type
Packaged
Modular
Custom
Other Types

Segmentation by End User
Residential
Commercial
Industrial

Segmentation by Region
North America
Europe
Asia-Pacific
Latin America
Middle East and Africa

Based on the type of air handling units (AHUs), the packaged segment accounted for the largest share, representing 39.63% of the market in 2022. The packaged AHU segment was valued at USD 5.44 billion in 2022 and is projected to reach USD 7.53 billion by 2028. During the forecast period (2023-2028), the modular segment is expected to have the highest compound annual growth rate (CAGR) of 6.88%.

Packaged AHUs are comprehensive, factory-assembled solutions for HVAC systems. They feature a built-in reversible heat pump that regulates the temperature of the supply air stream to predetermined levels, reducing the demand for heating or cooling energy. These units, which typically include a cooling section, fans, filters, and dampers, are commonly used in smaller buildings and commercial applications. The market for packaged AHUs is anticipated to grow due to increased demand across various industries, including healthcare, medical, and food processing.

By end-user, the commercial segment held the largest share, accounting for 43.56% of the market in 2022. The commercial segment was valued at USD 5.98 billion in 2022 and is expected to reach USD 8.73 billion by 2028. This segment is projected to have the highest CAGR of 6.95%. Air handling units are essential in commercial structures such as restaurants, data centers, hospitals, schools, hotels, and office buildings, providing occupants with a comfortable environment. These units are part of larger HVAC systems and are responsible for drawing in fresh outdoor air, cleaning and conditioning it, and then heating or cooling it as needed. Air handler units can be utilized for single spaces or entire buildings, and they are often located in basements or on the roofs of commercial-sized buildings.

In terms of geography, the Asia-Pacific region held the largest share, accounting for 42.52% of the market in 2022. The Asia-Pacific segment was valued at USD 5.84 billion in 2022 and is expected to reach USD 8.62 billion by 2028. This segment is projected to have the highest CAGR of 7.14%. The rapid growth of infrastructure and building projects, along with the increasing demand for energy-efficient technologies, are the primary drivers of the AHU market in the Asia-Pacific region. In the pharmaceutical industry, air handling units are critical for maintaining a controlled environment to ensure product quality and prevent contamination. With the establishment of new chemical and pharmaceutical facilities, such as the Yeosu Mononitrobenzene Manufacturing Plant and Tuas Biomedical Park New Vaccine Production Facility, the demand for AHUs in the region is expected to grow.

The significant share of the Asia-Pacific region can be attributed to the fast-growing industrial sector, as well as urbanization and commercialization in countries like India, Japan, China, and South Korea. Rising disposable income and improving living standards also contribute to the increasing demand for comfortable living spaces. Moreover, the Asia-Pacific region is playing a crucial role in global efforts to achieve net-zero emissions and transition to green energy. Several governments in the region have implemented initiatives and programs to promote energy conservation, providing ample opportunities for technologists in the HVAC and building automation systems focused on sustainability.

Southeast Asia is experiencing substantial growth in energy consumption for space cooling, making it the fastest-growing energy use in buildings worldwide. Currently, only 15% of households in Southeast Asia use air conditioners, indicating significant potential for expansion in this key region. As incomes rise, energy availability improves, and affluence spreads, the demand for HVAC systems will become more affordable for a larger population in Southeast Asia, creating a substantial market opportunity.


Competitive Landscape

The AHU market is characterized by intense competitive rivalry, as it is comprised of numerous large vendors who not only hold significant market shares but also possess well-established distribution networks.

Many manufacturers are prioritizing energy efficiency as a key concern. As an example, in October 2022, Johnson Controls introduced a newly revamped line of air handlers. These air handlers aim to enhance comfort, maximize energy savings, and comply with the DOE 2023 efficiency standards when paired with Johnson Controls’ new outdoor condensers.

Leading vendors in the market are actively engaging in mergers and acquisitions (M&A) and partnerships to expand their market penetration and increase their market share. For instance, in November 2022, Trane Technologies completed the acquisition of AL-KO Air Technology, a division of AL-KO SE based in Jettingen-Scheppach, Germany. AL-KO Air Technology specializes in the design, manufacturing, sales, and servicing of sustainable air handling units and extraction systems for various industries, including pharmaceuticals, healthcare, industrial processes, retail, recreation, and commercial buildings.

Key Companies Profiled in this report include Blue Star Limited, Carrier Corporation, Daikin Industries Ltd, Hitachi Ltd., Johnson Controls International plc, Lennox International Inc., Swegon Group AB, Systemair AB, Trane Inc., Trox GmbH.


Recent Industry Developments

In December 2022, Swegon made an announcement regarding its acquisition of Dalair, a prominent air handling unit manufacturer based in the United Kingdom. This strategic agreement is aimed at bolstering Swegon’s presence in the UK and Ireland markets. By incorporating Dalair, Swegon gains access to a brand that offers a comprehensive range of air handling units for various sectors, including commercial buildings, offices, retail spaces, healthcare facilities, and pharmaceutical industries.

In November 2022, Trane Inc. (Trane Technologies PLC) disclosed its plans to reduce the carbon footprint of its durable HVAC solutions. To achieve this goal, Trane has entered into partnerships with two major suppliers, Nucor Corporation Econiq and US Steel verdeX. Through these alliances, Trane will procure low-carbon steel, which will be utilized in its US manufacturing processes. This sustainable steel will be used to construct Trane’s high-efficiency heat pumps and air conditioners for residential applications, as well as thermal management systems for commercial buildings such as schools and data centers.


Key Questions Answered

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What is the growth rate of the Global Air Handling Units (AHU) Market?
What is the size of the Global Air Handling Units (AHU) Market?
Which region exhibits the highest growth rate in the Global Air Handling Units (AHU) Market?
Which region holds the largest share in the Global Air Handling Units (AHU) Market?
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