Global Heating, Ventilation & Air Conditioning (HVAC) Market: Analysis By Type (Equipment and Aftermarket & Services), By End User (Residential and Commercial), By Region (Asia Pacific, North America, Europe and ROW), Size and Trends with Impact of COVID-

Global Heating, Ventilation & Air Conditioning (HVAC) Market: Analysis By Type (Equipment and Aftermarket & Services), By End User (Residential and Commercial), By Region (Asia Pacific, North America, Europe and ROW), Size and Trends with Impact of COVID-19 and Forecast up to 2027

The global heating, ventilation & air conditioning (HVAC) market was valued at US$156.44 billion in 2021, and is expected to be worth US$231.11 billion in 2027. Heating, Ventilation and Air Conditioning (HVAC), is a technological system, which is used to provide cooling ventilation and heating facilities to the building. Heating appliances like heater, furnace and heat pumps, are used to generate heat in buildings via central heating or local heating. Ventilation appliances are used to change or replace air in any building to regulate temperature. Air conditioning appliances are used in cooling of indoor air for thermal comfort.

The HVAC industry is gradually shifting the emphasis toward energy efficiency. Several OEMs are focusing on green initiatives in order to save money while reducing greenhouse emissions. As a result, there has been a shift in recent years toward eco-friendly HVAC units. This includes products that use less power and run on renewable energy sources, lowering energy costs. The heating, ventilation and air conditioning (HVAC) market is determined to grow at a CAGR of 6.72% over the forecasted period of 2022-2027.

Market Segmentation Analysis:

By Type: The report identifies two segments on the basis of type: Equipment and Aftermarket & Services. On the basis of end user, HVAC equipment market is classified into two types: Commercial and Residential. Residential HVAC equipment is further classified as ductless and unitary, while commercial HVAC equipment is classified as ductless, unitary, and applied. The residential segment is foreseen to be the fastest growing segment, growing at CAGR of around 9% during the forecasted period. An increase in multi-family and individual homeowners is opening up opportunities for the residential HVAC segment. Residential HVAC demand is expected to be more or less stagnant in developed parts of the world; however, demand from newer markets, particularly developing markets, is expected to be significantly higher. This is primarily ascribed to the growing population in emerging markets and market maturity in developed markets.

By Region: In the report, the global heating, ventilation and air conditioning (HVAC) market is divided into four regions: Asia Pacific, North America, Europe, and ROW. Asia Pacific dominated the HVAC market, accounting for more than 50% of revenue in 2021. Rapid urbanization, population growth, and rising consumer disposable income have all contributed to the region's phenomenal growth over the years. Recently, the commercial sector has expanded, creating opportunities for future regional growth.

North America was the second-largest consumer of HVAC systems, closely followed by Europe. The market for HVAC systems in the region has reached maturity; however, replacement sales due to aging infrastructure or retrofit projects are creating alternate revenue streams for OEMs in North America in addition to expansion into the services and maintenance category. Over the forecast period, the region is expected to grow at a CAGR of more than 7%.

Market Dynamics:

Growth Drivers: One of the key drivers of the market's expansion is the increasing adoption of sustainable building designs. Rising awareness amongst the population about the energy efficiency of HVAC equipment and aftermarket services are pushing the economies towards the adoption of sustainable building designs. The growth in green-labeled products due to increased environmental awareness has given rise to thermally driven air-conditioners. 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. Other significant growth factors of the market include, increasing population, increasing construction activities, growing smart thermostat market, intensifying annual mean temperature, and escalating e-commerce retail sales.

Challenges: However, some challenges are impeding the growth of the market such as increasing raw materials prices, growing government regulations, data infrastructure system security and retail consolidations. The fluctuation in the prices of copper and iron ore have been rising over the past few years and proved as a major concern for all the companies of the HVAC market. This rising fluctuation in the prices of iron ore and copper is restricted the availability of major raw materials (copper, iron and steel) which are used for manufacturing of HVAC. Therefore, fluctuations in the prices of raw materials is disrupting market revenues.

Trends: The market is projected to grow at a fast pace during the forecast period, due to emerging home automation market, surging demand for invertor air conditioner (AC) in China and technological advancements. In recent years, the use of geothermal cooling and heating equipment has increased, reducing reliance on fuel-based equipment. The customer preference for comfort is opening up new opportunities. To meet demand, OEMs are developing products that are not only energy-efficient but also incorporate cutting-edge technologies for improved connectivity. Today's buildings are ""green,"" which has led to an increase in the installation of thermostats, sensors, and smart metres that can be controlled via smartphone or PC. HVAC systems with software are also trending and are expected to create opportunities over the forecast period. Technology is slowly infiltrating the HVAC market, opening up opportunities for long-term growth.

Impact Analysis of COVID-19 and Way Forward:

During initial stages, the pandemic had created an enormous economic downturn worldwide, which has been felt at every level of the heating, ventilation and air conditioning (HVAC) industry. The commercial sector was hit particularly hard in every part of the world; customer demand, operation and planning among HVAC manufacturers and distributors were changed. Many HVAC manufacturers also halted the production in the initial stages of the pandemic.

After mid 2020, the HVAC industry was more focused on sustainability, diversity, technological solutions and environmental stewardship. They were sophisticated about finance and practical about operations. New digital technologies like artificial intelligence (AI and IoT) supported the growth of the market and further technological advancements are expected to support the market growth during the post COVID period.

Competitive Landscape:

The global heating, ventilation and air conditioning (HVAC) market is moderately concentrated. Market players have implemented sustainable growth techniques in the market. To strengthen their position in the market, some of the leading competitors are pursuing various growth methods such as mergers, acquisitions, collaborations, and agreements.

The key players in the global heating, ventilation and air conditioning (HVAC) market are:

Daikin Industries
Johnson Controls International Plc.
Raytheon Technologies Corporation
Trane Technologies Plc.
Lennox International, Inc.
Honeywell International Inc.
Emerson Electric Co.
Mitsubishi Electric Corporation
Samsung Electronics
Schneider Electric SE
Nortek Inc.
Danfoss AS
Jackson Systems

Technology and energy efficiency are two buzzwords that OEMs are aiming to target in the short term in order to remain relevant and profitable. To gain a competitive advantage, market players prioritize research and development in order to develop technologically advanced and differentiated products. Companies are also focusing on developing products that adhere to regional regulatory norms in order to eliminate the risk of losing business due to regulatory violations. For instance, Lennox International, Inc. introduced four ultra-low emission gas furnaces which were developed to comply with the new California South Coast Air Quality Management District’s Rule.

Global Heating, Ventilation & Air Conditioning (HVAC) Market: Analysis By Type (Equipment and Aftermarket & Services), By End User (Residential and Commercial), By Region (Asia Pacific, North America, Europe and ROW), Size and Trends with Impact of COVID-19 and Forecast up to 2027 - Report Summary

Report Metrics	Details
Years Considered	2017-2027
Base Year	2021
Forecast Period	2022-2027
Page Count	173
Units Referenced	US$
Segments/Key Topics	By Type, By End User
Regions Covered	Asia Pacific (China, Japan, India, and the Rest of the Asia Pacific), North America (The US, Canada, and Mexico), Europe (Germany, UK, and the Rest of Europe), and ROW
Key Companies Mentioned	Daikin Industries, Johnson Controls International Plc., Raytheon Technologies Corporation, Trane Technologies Plc., Lennox International, Inc., Honeywell International Inc., Emerson Electric Co.; Mitsubishi Electric Corporation, Samsung Electronics, Schneider Electric SE, Nortek Inc., Danfoss AS and Jackson Systems.

What is the size of this market?
The global heating, ventilation and air conditioning (HVAC) market in 2021 was valued at US$156.44 billion.

What is the forecasted growth for this market?
The market is expected to reach US$231.11 billion by 2027. The market is expected to grow at a CAGR of 6.72% during the forecast period of 2022-2027.

What are key factors driving this market?
Increasing disposable incomes, particularly in hotter regions of the world, have encouraged the use of air conditioners, favoring the demand for cooling systems such as air conditioners (AC), unitary ACs, and so on. Furthermore, changing climatic conditions and the need to maintain an ambient environment in a building have facilitated market growth. Smart features and energy efficiency have recently become important purchase criteria for most customers, and this trend is expected to continue in the coming years.

How is this market segmented in this report?
In the report, the global heating, ventilation and air conditioning (HVAC) market is segmented on the basis of type (equipment and aftermarket & services). On the basis of end users, HVAC equipment market is classified into two categories residential and commercial. Residential HVAC equipment is further sub-classified into ductless and unitary, while, the commercial HVAC equipment is sub-classified into ductless, unitary and applied.

What is the definition of this market in this report?
Heating, ventilation and air conditioning (HVAC), is a technological system, which is used to provide cooling ventilation and heating facilities to the building. Heating appliances like heater, furnace and heat pumps, are used to generate heat in buildings via central heating or local heating. Ventilation appliances are used to change or replace air in any building to regulate temperature. Air conditioning appliances are used in cooling of indoor air for thermal comfort.

What are the major influences driving the growth/decline of this market?The global heating, ventilation and air conditioning (HVAC) market is expected to increase due to the growing global population, increasing construction activities, growing smart thermostat market, intensifying annual mean temperature, escalating e-commerce retail sales and adoption of sustainable building designs. Yet the market faces some challenges such as increasing raw materials prices, growing government regulations, data infrastructure system security and retail consolidations.