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Global air conditioning sales reach US$70 billion in 2008April 2009

Despite the turbulent economy, the market reached just over US$70 billion in 2008, representing a 2.5% increase from 2007 however the market is expected to decrease slightly in 2009.


Figure 1. Average annual value growth rate by product, %, 2007-2012 (click image to zoom)
Asia-Pacific remains the largest world region in terms of air conditioning sales, accounting for 40% of the total market by value, followed by the Americas region and Europe. The Chinese market is not only the largest market in Asia, but also the biggest market by value in the world; approximately 60% of world air conditioning units were produced in China in 2008. The US market follows closely after the market leader with a value of US$13.3 billion.

All countries in Europe are expecting 2009 to be one of the toughest years for their economies. Markets that were hit particularly bad by the economic downturn include Spain and Russia. Unemployment rates in Spain have reached 13% with further increases expected. Public and private investment has ground to a halt in Spain. Emerging economies are not immune to the strain of the financial crisis with Ukraine and Hungary having to seek loans in order to restore economic stability.

The residential/light commercial market was valued at US$51.4 billion, which includes windows and moveables. Minisplits were the largest market segment in terms of value.

Moveables
The US is now the world's leading moveables market experiencing rapid growth over the last few years. Europe is the largest region for sales of moveables, with Italy being the largest European market accounting for 117,000 sales of units. Unfortunately due to a poor summer in the UK, sales of moveables dropped to almost zero for the second half of 2007, and dropping again in 2008. The extreme heat in the Middle East, African countries and most parts of India hampers the sales of moveables units. This type of equipment does not provide sufficient cooling loads to cope with the extreme temperatures of these regions.

Windows/Through the wall
The total Americas region remains the world market leader for window/through the wall systems  with 70% by volume and 61% by value. In 2008, the total size of the global windows market was estimated to be 16.2 million units. The US dominates the sales of this market, but has been hit hard by the recession and depressed residential market. India and Saudi Arabia's market for windows are among the largest in the world accounting for up to 30% of the total region market size in 2008. Russia and other former CIS (Commonwealth of Independent States) countries remain the biggest markets in Europe for windows. The Russian window air conditioning market has been rapidly developing since 1998; in terms of air conditioning sales in Europe, Russia accounted for 45% of the total sales by value in 2008.

Splits
India represented one-third of the total Middle East, India and Africa region with over 2 million minisplit systems sold in 2008. This market is expected to experience further buoyant growth of over 40% per annum during the next few years.

In terms of value the splits market is the largest market with the total sales of all splits in 2008 amounting to US$47.1 billion with a corresponding volume of 61.7 million units, representing an increase in value of two per cent and a decrease in volume by three per cent.

Unlike the rest of the splits market, the global VRF market experienced an increase of eight per cent by volume and value. This growth can be attributed to planned projects therefore the VRF market did not initially feel the full affects of the downturn. However as with all markets, the picture of the VRF market in 2009 is bleak, as at presents projects are simply not starting. Asia Pacific has by far the largest sale of shares with 62% by value.

With 23 million units sold in 2008, China continues to be the largest split market in the world and also the biggest manufacturer. US ducted style split sales in the total Americas region accounted for 77% by value of all world sales.

Single Packaged
The European single packaged market is dominated by the indoor packaged sector, by volume, though the rooftop market represents by far the greatest share in value. Italy has the largest rooftop market by volume because of recent construction of new shopping centres and large retail hubs in several Italian regions. Whereas Spain has the largest indoor packaged market with sales of 24, 016 units in 2008.

The US market for indoor packaged systems represents the greatest share by value with 55% of the world market. Likewise the US dominates the rooftops market with a 70% share by value. Overall in 2009, the rooftops market and indoor packaged markets are expected to experience further decline in line with the economic downturn.

Chillers
The Chiller market experienced a decline of two per cent in volume and six per cent by value in 2008. Centrifugal increased their share on the chiller market reaching US$1.9 billion in 2008. Although the Middle East and India region represent the smallest by value there are significant markets in India, UAE and Saudi Arabia; overall the chiller market is expected to enjoy a slight increase over the next few years although the growth rate will vary from country to country. Centrifugal chillers are the fastest growing segment in the Indian chiller market with 55% growth in value and capacity sold.

Reciprocating compressors continue to disappear from the majority of markets with the trend leaning towards scroll and screw compressors.

Airside
The airside market reached an impressive US$6.6 billion in 2008. An increase of eight per cent from 2007 was reflected in the air handling unit market, the trend continues towards customised units and heat recovery models. Unlike the European market, the concealed type of fan coil dominates the Asian market, accounting for 68.7% of the market volume. In the European market Russia has the largest share of air handling units sold by around 21% in volume. The Asia Pacific region represents around 40% of the global market, and is dominated by China. 

Statistical data in this article is quoted from the World Market for Air Conditioning study, published in March 2009. For more information on the availability and costs of these reports contact Tim Page +44 1344 465629.
 

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