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The global heating, ventilation, and cooling (HVAC) system market size was USD 130.19 billion in 2019 and is projected to reach USD 191.83 billion by 2027, exhibiting a CAGR of 5.0% during the forecast period.
Heating, ventilation and cooling systems are utilized to transfer air between indoor and outdoor areas. They filter the indoor air to keep environment healthy and maintain humidity at an optimal comfort level.
Increasing demand for hybrid HVAC systems is an emerging trend. The growing demand for automatic adjustment of temperature is complimenting the growth of hybrid systems. Additionally, the surge in construction activities in commercial and residential sector and demand from food & beverage and telecom industries is anticipated to contribute significantly to the HVAC system market growth. However, the lack of qualified professionals is expected to grow and to impact the market growth in the near future.
Adverse Impact of COVID-19 on the HVAC System Market Attributed to Halted Manufacturing Processes
The COVID-19 pandemic has had an unprecedented impact on the global economy since the first case was reported in December 2019. In the first quarter of 2020, the global heating, ventilation, and cooling system market growth has been adversely affected by the COVID-19 pandemic. This is attributable to the lockdown of several component manufacturing facilities across countries including, Ireland, Germany, U.S., China and others. The lockdown has not only halted the manufacturing process but has also shrunken the customer demand for HVAC equipment.
However, the demand for air filters across residential usage, purified air supply across commercial buildings, and minimization of suffocated air over industrial areas is expected to boost the demand for HVAC system in the coming future. Additionally, governmental bodies such as the Federation of European Heating, Ventilation and Air Conditioning Association, ASHRAE, and others are employing mitigation tactics that can help to further reduce the possibility of HVAC system becoming contaminated with the COVID-19 virus. This, in turn, is expected to compliment the rising demand for these systems amid the current crisis.
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Rising Preference for Hybrid HVAC Systems to Take the Market by Storm
The surge in demand for hybrid HVAC systems is expected to result in the heating, ventilation, and cooling system market growth. The benefits of hybrid systems such as automatic adjustment of the temperature according to the change in environment are gaining popularity among customers. For instance, in October 2019, Carrier introduced ‘Carrier Hybrid Heat’ that utilizes gas furnace and electric heat pump as a heating source to react to changing environment. Also, the high energy-efficiency of these systems results in cost reductions, thus offering high returns on initial investments. In addition, the reduced environmental impact and increased system lifespan is resulting in rising demand for hybrid systems.
Technological Advancements in HVAC Systems to Propel the Market
Rising demand for technologically advanced heating, ventilation, and cooling systems is expected to drive the market growth. The growth in green-labeled products owing to the increased environmental awareness has given rise to the thermally driven air-conditioners. Manufacturers such as Lennox International Inc., Daikin Industries, Ltd. and others are offering these systems. These air-conditioners utilize both natural gas as well as solar energy, thus ensuring energy efficiency. The additional benefits offered are low maintenance, independent control of pipes for heating and cooling purposes, and automatic adjustments to current requirements, along with improved lifetime cost and efficiency. Furthermore, smart thermostats and sensors, which can be controlled remotely through apps, are gaining popularity among the customers, especially in commercial buildings, in order to gain energy- and cost-efficiency. Therefore, the technological advancements in HVAC system are complementing the global market growth.
Shortage of Skilled Labor to Impact the Market
The lack of qualified technicians for heating, ventilation, and cooling systems over the past few years is expected to impact the market growth. According to the Bureau of Labor Statistics, U.S. has a shortage of more than 70,000 technicians. In addition, 25% of the workforce is expected to retire by the end of 2020, increasing the need for skilled professionals. Furthermore, the companies will seek around 115,000 new HVACR qualified technicians in the next four years. However, the companies are growing through strategic planning and providing various trainings to their employees.
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Increasing Intelligent Variable Refrigerant Flow (VRF) Systems Evolution is Propelling the Market
Based on type, the market is segmented into the single split, variable refrigerant flow (VRF) systems, chillers, and others.
Single-split systems are most commonly used as they offer benefits, including easy installation, quick & silent operation, cost-effectiveness, easy maintenance, add-on heating capacity, and others.
The VRF systems sub-segment is expected to witness highest CAGR as these systems offer two or more controls in a single device.
Increasing Demand from the Commercial Sector to Support Growth
Based on application, the segment is broken down into residential, commercial, and industrial. Increasing construction activities in the residential and commercial sectors are fueling the growth of the market. Increasing demand from various sectors including institutional buildings, data and telecom centers, hospitals, restaurants, laboratories, and office buildings in developing economies is resulting in the growth of the commercial HVAC segment. On the other hand, the industrial application is expected to witness steady growth over the forecast period owing to stability observed in the HVAC system market across industrial applications.
Asia Pacific Heating, Ventilation, and Cooling (HVAC) System Market Size, 2016-2027 (USD Billion)
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Geographically, the market is segmented into North America, Europe, Asia Pacific, the Middle East & Africa, and Latin America, which is further grouped into countries.
Asia Pacific is expected to be the fastest-growing market owing to the increase in the increasing spending power of the customers. Thus, manufacturers are focusing on developing heating, ventilation, and cooling systems to cater to regional requirements.
The increasing need for commercial heating and cooling units across European countries is expected to drive the market. Moreover, stringent government norms in order to stabilize cost effective units, is also boosting the market growth.
The North America market is expected to significantly contribute to the global HVAC system market share, attributed to the increasing demand from the residential sector.
Several manufacturers are strategically planning to boost sales in Mexico, which in turn is expected to positively contribute to the growth of the market in Latin America. Increasing demand for VRF systems is likely to result in the growth of the Middle East and Africa.
An Infographic Representation of Heating-Ventilation-and-Cooling-HVAC-System-Market
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The heating, ventilation, and cooling system market report provides detailed insights of the market. Some of them are growth drivers, restraints, competitive landscape, regional analysis, and challenges. It further offers an analytical depiction of the market, current market trends, and estimations to illustrate the forthcoming investment pockets. The market is quantitatively analyzed from 2020 to 2027 to provide the financial competency of the market. The information gathered in this report has been taken from several primary and secondary sources.
Value (USD Billion)
Fortune Business Insights says that the global heating, ventilation, and cooling system market value stood at USD 130.19 billion in 2019.
In 2027, the market is expected to reach USD 191.83 billion.
The global market is estimated to grow at the highest CAGR of 5.0% during the forecast period (2020-2027).
The single split systems segment is expected to lead the market.
Technological advancements in HVAC systems is driving the global market.
DAIKIN INDUSTRIES, Ltd., Carrier and Johnson Controls are the leading companies in the market.
Asia-Pacific is the fastest-growing region in this market.
Increasing adoption of the hybrid HVAC system is one of the emerging trends in the market.
Commercial application is leading this market
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