Global Heating, Ventilation, Air Conditioning, and Refrigeration (HVAC-R) Market 2021
The global HVAC-R market is experiencing significant growth and is projected to reach $257.9 billion by 2027, with a CAGR of 5% during the forecast period of 2022-2027. This growth can be attributed to factors such as increasing population, rapid urbanization, changing weather conditions, and emerging innovations in the HVAC-R industry.
HVAC-R systems emerged during the industrial revolution when it was realized that industries lacked the ability to control temperatures during extreme climate changes. These systems have now become an integral part of residential, commercial, and industrial sectors such as food and beverage, hospitality, and large institutional buildings.
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USD 193.6 billion in 2020
Application, Product, Region
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The HVAC-R market is currently in a phase of growth, with ongoing research and development activities focused on enhancing HVAC-R products and introducing new technologies. The adoption of smart technology in the HVAC-R industry, particularly in smart homes, is also on the rise. Homebuyers are increasingly demanding the latest technological advances, including advanced HVAC-R systems.
There is also a growing focus on green energy in the HVAC-R industry, with the adoption of technologies such as geothermal and solar power, as well as energy-saving products like smart thermostats and ice-powered air conditioning. Regions such as North America and Asia-Pacific are leading this shift towards green energy.
Moreover, the HVAC-R market has witnessed the adoption of environmentally friendly refrigerants, with companies like Chemours and Daikin dominating the market in this regard. The introduction of refrigerants with lower environmental impact, such as R-134a, R-32, and R-410A, presents significant opportunities for the HVAC market.
The impact of the Covid-19 pandemic on the HVAC-R market has been relatively positive compared to other industries. The airborne spread of the virus highlighted the importance of improving indoor air quality in multi-occupancy buildings, leading to increased demand for HVAC-R systems. Additionally, the shift towards remote work during and after the pandemic has also driven demand in the air conditioning sector.
While there are several demand drivers for the HVAC-R market, including increasing population and rapid urbanization, there are also limitations and challenges to consider. Adherence to stringent regulations to maintain energy efficiency standards, the growth of alternative technologies, and the harmful effects of chlorofluorocarbons (CFCs) and hydrochlorofluorocarbons (HCFCs) are factors that may limit market growth.
Overall, the global HVAC-R market is experiencing significant growth and is expected to continue expanding due to various factors driving demand and ongoing innovations in the industry.
The market is segmented based on various factors, including application, product, and region.
Segmentation by Application
Segmentation by Product
Heating – Heat Pumps, Furnaces, Boilers, and Others
Ventilation – Air Filters, Humidifiers, Air Purifiers, Air Handling Unit (AHU) and Fan Coil Unit (FCU), and Others
Air Conditioning – Window and Portable Air Conditioning, Mini-Split Air Conditioning, Packaged Air Conditioning, Chillers, Variable Refrigerant Flow (VRF) Systems, and Others
Refrigeration – Type (Freezers and Refrigerators, Commercial Refrigerators, Refrigerated Transport) and Refrigeration Cycle Components (Compressor, Condenser, Expansion Valve and Evaporator)
Segmentation by Region
North America – U.S., Canada, and Mexico
Europe – Germany, France, Italy, Rest-of-Europe
Asia-Pacific – Japan, India, South Korea, Australia, Singapore, Malaysia, Thailand, and Rest-of-Asia-Pacific
South America- Brazil, Argentina, Rest-of-South America
Middle East and Africa- South Africa, UAE, Rest-of-Middle East and Africa
HVAC-R systems are extensively utilized in the building and construction industry, catering to the residential, commercial, and industrial sectors. Within the application segment of the global HVAC-R market, the Commercial sector is projected to dominate. This is primarily driven by the growing number of commercial projects worldwide, including offices, schools, colleges, hotels, and restaurants. Corporate and industrial buildings widely employ HVAC systems, typically situated on the rooftops of commercial structures. The range of commercial properties utilizing HVAC-R systems varies from small coffee shops to office buildings, warehouses, and public spaces. The commercial sector has experienced substantial growth due to increasing demand for office rentals, flexible office spaces, and the expansion of startups and technology companies globally.
To meet the diverse requirements of commercial establishments, HVAC-R systems offer different heating and cooling setups, layouts, and capacities. Large-scale commercial applications commonly employ rooftop units, heaters, heat pumps, chillers, and other HVAC-R solutions. In 2020, the global commercial real estate market reached approximately $32.6 trillion, rising from $30.3 trillion in 2019. The Europe, Middle East, and Africa (EMEA) region dominated the global commercial real estate market with the largest market size of around $10.3 trillion, followed by the Asia-Pacific and North America regions. Consequently, the demand for HVAC-R systems in the commercial sector is expected to continue growing worldwide.
The HVAC-R market encompasses a wide array of products related to heating, ventilation, air conditioning, and refrigeration. Air conditioning is anticipated to be the dominant sector in the global HVAC-R market, experiencing positive growth in developing countries. The air conditioning segment includes window and portable air conditioners, mini-split air conditioners, packaged air conditioners, chillers, variable refrigerant flow (VRF) systems, and others.
Within the Heating segment, heat pumps take the lead due to their versatility across various applications. Heat pumps find application in domestic and commercial heating scenarios, such as water and space heating, and clothes drying. These pumps extract heat from the outside air and transfer it indoors. The required drive power for air transfer can be mechanical, electrical, or thermal.
The Ventilation sector is dominated by the Air Handling Unit (AHU) and Fan Coil Unit (FCU) segments. AHUs and FCUs are extensively used in showrooms, offices, hotel rooms, condominiums, and other spaces. AHUs condition and circulate air as part of HVAC-R systems. Comprising a blower, heating or cooling elements, humidifiers, sound attenuators, mixers, dampers, and more, AHUs ensure that air circulates safely and efficiently while preventing the entry of dirt and debris. This unit coordinates with both cooling and heating equipment and connects to ductwork in centralized systems to distribute air across various areas.
Within the air conditioning segment, mini-split air conditioners hold the majority share. They are further classified as ducted and ductless systems. Ductless split systems encompass a range of equipment, combining an outdoor unit with one or multiple indoor units in various styles like cassette, wall-hung, console, under-ceiling units, and others. Ducted split systems find widespread use in domestic and light commercial applications. Mini-split air conditioning is commonly employed in small rooms and halls where window units are unsuitable. Due to their high energy efficiency and ease of installation, split ACs are increasingly preferred over window ACs by residential consumers. Both ductless and ducted split systems fall under this category, with the former not requiring ductwork during installation.
The Asia-Pacific and North America regions currently dominate the HVAC-R market, offering attractive opportunities due to the presence of diverse market segments. The Asia-Pacific region holds the largest share in the global HVAC-R market, driven by population growth, rising incomes, and increased demand for HVAC-R systems. India and Japan play significant roles in the heating, ventilation, and air conditioning market in the Asia-Pacific region. In 2021, the Asia-Pacific HVAC-R market generated sales revenue of $77,468 million, projected to reach $108,079 million by 2027 at a CAGR of 5.91%. Factors contributing to the growth of the Asia-Pacific HVAC-R market include heightened construction activities, rapid urbanization, infrastructure reforms, and HVAC-R unit replacements. Japan, India, and South Korea serve as technological hubs with the presence of leading players like Carrier, LG Electronics, and Johnson Controls. The global HVAC-R market is rapidly expanding and is expected to achieve a CAGR of 5% during the forecast period from 2022 to 2027. This growth is driven by increasing population, rapid urbanization, fluctuating weather conditions, and emerging innovations within the HVAC-R ecosystem.
The competitive landscape of the global HVAC-R market reveals a trend among companies to adopt strategies such as mergers, collaborations, product launches, and contracts, among others. Additionally, the industry is evolving, and market players are actively organizing or participating in various events to raise awareness.
Prominent companies in the global HVAC-R market include SAMSUNG ELECTRONICS CO., LTD., Robert Bosch GmbH, DAIKIN INDUSTRIES, Ltd., Coway, LG Electronics, Lennox International, and Dyson. These companies have introduced a wide range of HVAC-R products and engaged in partnerships and collaborations. For example, in March 2021, Condair Group launched the Condair MC, an in-duct evaporative humidifier and cooler that is sustainable and energy-efficient.
Furthermore, the emergence of environmentally friendly refrigerants such as R-134a, R-32, and R-410A, as well as the development of green buildings and smart cities, present significant opportunities for the expanding HVAC-R market.
Key companies profiled in this report include Carrier, DAIKIN INDUSTRIES, Ltd., Hitachi, Ltd., Johnson Controls, Koryo, Lennox International, LG Electronics, Nortek Global HVAC, Robert Bosch GmbH, SAMSUNG ELECTRONICS CO., LTD., Trane, Zamil Industrial, Condair Group, Coway, Dyson, FUJITSU GENERAL, GEFA SYSTEM, Munters, Resideo Technologies Inc., Vornado Air, LLC, Blue Star Limited, BSH Home Appliances Group, Valeo Transport Refrigeration, Voltas, Inc., Whirlpool.
Recent Industry Developments
In April 2021, Coway made its entry into the European market by introducing its sustainable and high-quality water and air purifying devices to the German population.
In January 2021, Samsung announced the market launch of its BESPOKE range of products, starting with customized refrigerators.
In February 2020, Nortek Global HVAC completed the acquisition of Reznor, a move aimed at strengthening its presence and network in Europe.
In July 2019, Munters unveiled a new product called Green Field Controllers. These controllers are specifically designed to enhance automation, efficiency, and quality in the agricultural industry by facilitating irrigation control and greenhouse climate control operations.
Key Questions Answered
What is the projected revenue of the global HVAC-R market during the forecast period 2022-2027?
What is the expected compound annual growth rate (CAGR) for the global HVAC-R market during the forecast period 2022-2027?
What are the key trends, market drivers, and opportunities in the global HVAC-R market?
What are the major factors restraining the growth of the global HVAC-R market?
What strategies are existing market players adopting to expand their market position in the global HVAC-R industry?
How do the key players in the global HVAC-R market compare in terms of their recent developments, product offerings, and regional presence?
How is the competitive benchmarking of the key players in the global HVAC-R market based on their market coverage and potential?
What is the revenue projection and growth percentage for each segment during the forecast period in the global HVAC-R market?
Which types of players and stakeholders operate in the market ecosystem of the global HVAC-R industry, and what is their significance in the global market?
Who are the leading consortiums and associations in the global HVAC-R industry, and what roles do they play in the market?