Air Handling Units Market Size, Share & COVID-19 Impact Analysis, By Type (Packaged, Modular, Custom, and Rooftop Mounted), By Business Type (New Equipment and Aftermarket), By Capacity (Less than 5,000 M3/h, 5,001 M3/h-15,000 M3/h, 15,001 M3/h-30,000 M3/h, and More than 30,000 M3/h), By End-user (Residential, Commercial, and Industrial), and Regional Forecast, 2022-2029

The global air handling units market size was valued at USD 10.59 billion in 2021 and is projected to reach USD 18.17 billion by 2029 from USD 11.26 billion in 2022, growing at a CAGR of 7.1% during the forecast period. Based on our analysis, the global market exhibited a decline of -2.8% in 2020 as compared to 2019. The global COVID-19 pandemic has been unprecedented and staggering, with air handling units experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels.

Air handling systems are also called air handlers. It is the heart of the central air conditioning system. These units are integrated units, having components such as air filters, heating as well as cooling coil, and air control dampers. These systems are used to collect and mix the outdoor air with indoor circulating air. Also, these products are used to purify the air and supply fresh air into the building premises. These systems are used in residential, commercial as well as industrial spaces. Commercial sector is identified as the leader in the global air handling units market share, owing to adoption of these systems in hotels and hospitality sectors. An increasing awareness among end-users about the impact on pollution on human health and fresh indoor air quality in commercial and industrial spaces is expected to boost the growth of the market.  

Growing urbanization and increasing construction related activities are anticipated to fuel the demand for these systems. In addition, rise in government investments in residential as well as commercial construction spaces will boost the market growth. For instance, in 2021, the Spanish government spent around USD 10.6 billion on infrastructure projects such as education institutes, healthcare, and housing premises. Such instances cater to the market growth. A rise in disposable income of end-users is expected to boost the demand for air conditioning products and air handlers. For instance, disposable income of end-users is anticipated to grow by around 9.5% from 2022-2024. A surge in disposable income of end users in economies such as the U.S., China, India, Germany, and others is driving the adoption of these systems. Hence, such factors drive the growth of the global market. An increase in demand for these products among commercial applications, such as hospitals, malls, data centers, and laboratories, and other industrial applications, is projected to fuel the market growth.  

COVID-19 IMPACT

Pandemic Impeded Market Growth Due to Closure of Manufacturing Activities

The COVID-19 pandemic negatively impacted the growth of the market due to prolonged lockdown implemented globally and closure of manufacturing facilities in the first quarter of 2020. In addition, halted manufacturing processes, construction related activities, and disruption in supply chains of raw materials negatively impacted the market growth. For instance, the net sales of Carrier Corporation dropped by around -6.2% from 2019 to 2020. However, the demand for these products across residential and commercial sectors is projected to surge the demand for air handlers in the forecast period.

The major players witnessed a substantial increase in revenue generated during 2020. For instance, net sales of LG Electronics increased by around 16.9% in the 4^th quarter of 2020 (January 2020 to March 2020) as compared to 2019. In the long term, the COVID-19 pandemic is anticipated to have a positive effect on the global market. Furthermore, post COVID-19 outbreak, many manufacturing facilities were reopened at full pace. Furthermore, technologically advanced products and work on research & development are projected to hold the process of long-term growth of the market. However, rising demand for hospital beds is projected to support the demand for these systems, which fuels the market growth. In addition, rise in work from home policies adopted by key players is projected to fuel the product demand, which will, in turn, boost the growth of the market in the coming years.

LATEST TRENDS

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Technological Advancements in the Product to Positively Boost Market Growth

Nowadays, major players are focusing on developing and launching technologically advanced AHU systems, with Artificial Intelligence (AI) based systems, Internet of Things (IoT) based systems, and integration of sensors in these systems to boost the market competition. For instance, Trox GmbH introduced X-Cube AHU units for residential, commercial, and industrial applications. It has airflow capacity of 1,200 M3/h to 100,000 M3/h. It has features such as high energy efficiency, hygiene, and easy to install. Furthermore, in April 2022, Zeco Aircon Ltd launched Smart AHU Unit, which is equipped with an integrated control system. It is best suitable for residential, commercial, and industrial premises. It saves up to 25% of the energy and maintenance costs and 24X 7 indoor quality management. It operates through remote control or smart phones. It has an airflow capacity of 1,000 M3/h to 60,000 M3/h. In addition, the Internet of Things technology within these types of systems is anticipated to provide lucrative opportunities for the market growth during the forecast period. The use of the Internet of Things (IoT) is facilitated to collect data and store it on cloud to improve the efficiency of these systems. In the past few years, these machines have implemented new technological advancements. These are the key market trends for the market growth.

DRIVING FACTORS

Rising Urbanization and Population Growth to Boost Market Growth

Rising urbanization and increasing population are some of the important factors, which are expected to surge the demand for these products and fuel the market growth. In addition, increase in construction related activities globally is creating significant demand for these products. In addition, approximately 55% of the global population lives in urban areas. The urban population is expected to increase up to 68% by the year 2050. This is projected to increase the commercial and residential construction activities, which will surge the demand for air handlers. In addition, government initiatives such as “Nation Program on Strategies for Sustainable Smart Cities” and “National Infrastructure Program” for constructing new residential and commercial projects, such government initiatives boost the demand for air handler. Increasing awareness among end-users about benefits associated with these systems, such as maintaining fresh air quality within commercial as well as industrial spaces to surge the demand for these products, caters to the growth of the market.

RESTRAINING FACTORS

High Installation and Maintenance Costs are Projected to Restrain Air Handling Units Market Growth

Air handling units require huge capital investment and huge maintenance costs, which are challenging factors for the market growth. For instance, air handling units require investment of around USD 25 K to USD 500 K; this cost is different from user to user. The associated cost consists of inspection, installation cost, integration of sensor costs, and aftermarket solutions, which increase the total ownership cost of these products. Moreover, residential as well as commercial end-users will purchase lower priced units, which restrains the market growth. Such factors are anticipated to hamper the growth of the global market.

SEGMENTATION

By Type Analysis

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Modular Segment to Portray Strong Growth Due to Increasing Demand from Commercial End-users

By type, the market is classified into packaged, modular, custom, and rooftop mounted.

The modular segment is projected to exhibit the highest CAGR of 7.9% during the forecast period. The modular segment is expected to witness the highest growth rate, owing to growing demand for cold chain and rising urbanization and industrialization, which is set to surge the demand for these types of products.

The packaged segment is a major contributor to the market growth due to increasing demand for packaged systems across a wide range of industries such as medical, healthcare, and food processing. These types of products are available in various capacities.

The custom segment is projected to witness a significant growth, owing to various key players developing these types of products. These products have features such as long durability, easy to install, easy to customize, and robustness. Key players such as Johnson Controls International Plc, Daikin Industries Ltd, and others are engaged in offering custom air handlers. These instances are set to boost the growth of the market.

Rooftop mounted segment is anticipated to witness a moderate growth due to increase in demand from retail stores, supermarkets, restaurants, and industrial applications. An increase in awareness about fresh air quality in commercial as well as industrial sectors is estimated to fuel the demand for more air quality units.  

By Business Type Analysis

New Equipment to Dominate the Market due to Rise in Demand from Commercial and Industrial Premises

By business type, the market is categorized into new equipment and aftermarket.  

The new equipment segment will dominate the market due to major players providing new air handling units for residential, commercial, and industrial applications across diversified locations.

The aftermarket segment is anticipated to witness substantial growth, owing to the need for spare parts and installation services after purchasing products. Aftermarket sales consist of maintenance cost, repair cost, and replacing cost. Major players, such as Lennox International Inc, Trane Technologies Plc, Carrier Corporation, and Johnson Controls International Plc, are some of the key players, which provide aftermarket sales services. Major consumers in developing countries, such as India, Brazil, and Africa, are using aftermarket sales services required for air handlers.

By Capacity Analysis

Less than 5,000 M³/h to Dominate owing to Growth in Commercial and Industrial Sectors

By capacity, the market is categorized into less than 5,000 M³/h, 5,001 to 15,000 M³/h, 15,001 to 30,000 M³/h, and more than 30,000 M³/h.

The less than 5,000 M³/h segment will dominate the market due to features such as compact size, mainly used for residential as well as commercial spaces. An increase in the number of single-family homes across the U.S. and Canada is projected to surge the demand for these types of handlers.

The 5,001 M³/h to 15,000 M³/h and 15,0001 to 30,000 M³/h segments are anticipated to grow with moderate growth, owing to increasing demand for these products in hospitals, shopping complexes, laboratories, and data centers. An increasing awareness about the use of AHU units in commercial spaces is expected to drive the growth of the market.

More than 30,000 M³/h segment is anticipated to witness a decent growth owing to this type of system being used for heating and cooling purposes. Generally, these types of systems are used in commercial and industrial spaces. It improves the air quality and circulates fresh air in the spaces. Such instances are expected to fuel the growth of the market.

By End-user Analysis

Commercial Segment to have Highest CAGR Owing to Increase in Construction-related Activities

Based on end-user, the market is segmented into residential, commercial, and industrial.  

The residential segment is anticipated to grow with decent growth, owing to government initiatives investing in residential projects across the globe, which increases the demand for these systems in residential sectors. In addition, the rising trend of single-family homes across North America and Europe has increased the demand for these systems.

The commercial segment is anticipated to grow with the highest growth rate and dominate the market owing to increasing commercial construction activities globally. The rise in demand from data centers, telecom sectors, hospitals, restaurants, and office buildings will fuel the growth of the market.  

The industrial segment is projected to grow with a steady growth rate, owing to rising industrialization, investment in industrial production, and government planning for investing in industrial activities, thereby driving the growth of the market. 

REGIONAL INSIGHTS

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The market is studied across five regions, North America, Europe, Asia Pacific, the Middle East & Africa, and South America.

The Asia Pacific region is projected to highest CAGR during the forecast period, and dominate the market, owing to increasing disposable income of consumers and rising construction related activities. Presence of major players such as Daikin Industries Ltd, LG Electronics, and VTS Group have their headquarters in Asia Pacific region.

The North America region is projected to grow with steady growth due to increasing demand from residential as well as commercial sectors. Also, increasing standard of living and luxurious lifestyle are set to drive the market growth. In addition, strong presence of manufacturers of air handlers in the U.S. and Canada is also one of the factors to promote growth of the market. Also, technological advancements in these products, such as artificial intelligence and sensor based systems, are widely adopted in commercial as well as industrial sectors.

Europe is growing with steady growth during the forecast period, owing to rising concerns for fresh air quality and increasing number of infrastructure projects in Italy, Spain, the U.K., and France. In addition, major players have adopted business expansion and product launches as key developmental strategies for intensifying the market competition. For instance, in June 2022, SINTRA opened a new Expertise and Technology Center (ETC) by investing around USD 6.29 million. The business expansion was done for introducing air handlers with several capacities. These factors are set to boost the growth of the market.  

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South America and the Middle East & Africa regions are expected to witness potential growth, owing to the rise in construction related activities and increasing tourism. For instance, in 2022, Dubai government planned to spend across USD 1.42 billion for construction projects, which include residential as well as commercial projects. Similarly, various manufacturers are planning to boost sales margin in Argentina, which is anticipated to contribute positively to the growth of the market in South America.

KEY INDUSTRY PLAYERS

Key Players are Focusing on Intensifying their Market Positions by Offering Technologically Advanced Products

Key players are focusing on introducing technology advanced products to offer suitable solutions to meet the requirements of customers. Key players offer air handlers, air fans, compressors, and related equipment. These types of products are largely used in residential and commercial space. Major players introduced rooftop mounted air handling units for the market. For instance, in September 2021, Holtop launched a new rooftop air conditioning or air handling unit. These systems have features such as energy-efficient compressor, energy saving mechanism, high efficiency, stability, robustness, and long durability. These types of products are utilized in railway bogies, manufacturing plants, and commercial spaces. Such instances are expected to drive the market growth. 

LIST OF KEY COMPANIES PROFILED:

• Daikin Industries Ltd (Japan)


• Carrier (U.S.)


• Trane Technologies Plc (Ireland)


• Johnson Controls International Plc (Ireland)


• Systemair AB (Sweden)


• LG Electronics (South Korea)


• Lennox International Inc (U.S.)


• Munters AB (Sweden)


• Investment AB Latour (Publ) (Swegon Group AB) (Sweden)


• Trox GmbH (Germany)

KEY INDUSTRY DEVELOPMENTS:

• February 2022 – Salda UAB launched a new Amber Air Compact S-CX air handler system for commercial and industrial applications. It has features such as easy to install, energy efficiency, and good material coating.


• January 2022 – Munters AB acquired EDPAC International based in Ireland, offering air handling units and HVAC systems. The acquisition was done for improving the product portfolio of air handling units, HVAC systems, and also increasing geographical presence in the European market.    


• December 2021 – Daikin Industries Ltd acquired distributors in Washington such as Thermal Supply Inc and AirReps LLC deals in HVAC Systems and air handling units. The acquisition was done for expanding their business in the North America region.


• March 2021 - Carrier Corporation launched a new high wall ductless system, which includes 38 MARB outdoor units and 40 MAHB indoor units. It is available in sizes of 36K, 24K, and 48K. It is best suitable for commercial and industrial applications.


• June 2020 - Johnson Controls International Plc acquired Silent-Aire Europe Limited based in Canada deals in air handlers and HVAC systems. The acquisition was done to improve the product portfolio of air handlers for data centers and industrial applications.


• October 2019 - Dunham Bush launched a new SCS3 series air handling system with the range of 50 HZ & 60 HZ. It has features such as capacity of 1,700 to 95,000 M³/h, super insulated, air tightness, and energy efficiency. It is best suitable for both commercial as well as industrial applications.  

REPORT COVERAGE

An Infographic Representation of Air Handling Units Market

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The research report focuses on leading regions across the globe to offer a better understanding to end-users. Moreover, the report offers insights into the industry dynamics and analyzes technologies utilized at a rapid pace across the world. It also displays some of the key factors and restraints to help the readers gain in-depth knowledge about the market.

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