World Air Conditioning Market Insights 2023: Regional Trends and Dynamics

The global AC market has been growing continually over the last decade, posting a healthy compound annual growth of some 7%. 2023 has followed the trend and the global sales of all AC units increased 5% from 2022 in value terms. Residential air conditioning market has grown by 9.4%, while the commercial AC market posted growth of 4.6%.

While the surge in production and logistic costs slowed down in 2023, the requirements for more efficient products supported growth of the market in value terms. The demand kept increasing in most regions, however sales patterns varied greatly between regions and countries.

The pace of prescribing phase-out of conventional refrigerants differs among countries, the structure of the markets is different and while overall economic situation is relatively gloomy across the globe, some countries have seen specific supportive measures impacting sales in a positive way.

The fastest market progression has been recorded in the Middle East. Saudi Arabia has implemented some of the most rigorous energy-saving standards to address the region’s rapidly growing electricity demand. And in the UAE the regulatory bodies such as the Abu Dhabi Quality and Conformity Council (QCC) are actively shaping standards to ensure environmental sustainability and consumer safety. In August 2023, the QCC introduced the ‘’Specific Requirements for Certification of Ozone- Friendly Air-cooled Unitary Air Conditioners (QCC-RQ25-02)’’, and new Energy Efficiency Ratio (EER) regulations which have been reshaping the UAE AC market since.

The US has also seen positive market environment, particularly in the commercial segment, which outperformed expectations buoyed by investments in manufacturing, data centres, life sciences and hospitality sectors. Brazil and Mexico are representing two bright spots in Latin America. Brazil’s AC market surpassed expectations in 2023, driven by robust economic growth, declining inflation and interest rates. Investments in healthcare, data centres and industry sustained demand. In Mexico, the AC market has seen notable growth supported by booming tourism, foreign investment, and moderate public spending ahead of the 2024 presidential elections.

Europe overall has experienced a positive development in AC market in 2023, recording over 6% growth on 2022, despite challenges due to economic strains and sluggish construction activity. After months of uncertainty, the recently agreed revision for F Gas proposal document, which has passed its first EU parliamentary vote in January 2024, confirms that the next big quota step down, originally scheduled for 1 January 2024 has now been put back to 1 January 2025.

Asia represents the biggest share by far of the global AC market. The overall Asian market has posted a healthy double-digit growth in 2023 supported by several positive developments in different countries. China market witnessed volume growth supported by the transition from R410A to R32 refrigerant accelerated in 2023. Economic downturns affected several commercial projects, but government support for high-tech industries sustained sales, particularly in process applications.

The Building Energy Code mandating energy conservation measures promoted smart AC systems in both Vietnam and Thailand. In Thailand, increased demand for inverter AC products has also been driven by rising energy prices. The government’s regulation aligning with the Kigali amendment to the Montreal Protocol, are supporting the transition towards environmentally friendly refrigerants. The Indonesian AC market continued its growth trajectory, with higher sales across various segments. Import restrictions in the high-wall split market drove domestic production. Economic growth fuelled demand in commercial sectors like hospitals, universities and data centres.

India’s AC market is a buoyant market, supported by population growth, urbanisation and government incentives for domestic production. Energy-efficient solutions and regulatory initiatives aim to align with global sustainability goals. The shift away from HCFCs and increasing demand for air-cooled chillers reflect overall market trends.

BSRIA has released the latest research data on global air conditioning markets’ developments in 2023 at the end of March 2024. Reports for individual countries and the global market overview include information on sales by type of products and the topline analysis of the market from technology perspective.

Detailed analysis of individual countries and regions, providing in-depth info on technology and commercial aspects of the markets is available on demand.

To order country reports or the global overview data please contact your regional team:

www.bsria.co.uk, www.bsria.com.cn, www.bsria.com.

This article appears on the BSRIA news and blog site as 'World Air Conditioning Market Insights 2023: Regional Trends and Dynamics' dated April 2024.

--BSRIA

[edit] Related articles on Designing Buildings

• Absorption refrigeration.
• Africa tops world AC growth forecasts.
• Air conditioning
• Air conditioning in non-domestic buildings.
• Air conditioning inspection (energy performance regulations).
• Air conditioning inspection procedure.
• Air handling unit.
• BSRIA completes 2021 World Air Conditioning market studies.
• BSRIA: new Global Air Conditioning Market Studies.
• Chiller units.
• Cooling systems for buildings.
• Data centres.
• Dehumidification.
• Designing HVAC to resist harmful microorganisms.
• Ductwork.
• Evaporative cooling.
• Fan coil unit.
• Fresh air.
• Heat recovery.
• How to Use Your Air Conditioning Energy Assessments to Reduce Energy Costs.
• Humidification.
• Humidity.
• HVAC.
• HVAC balancing.
• IAQ developments accelerated by COVID-19 pandemic.
• Local air conditioning.
• Refrigerants.
• Thermal comfort.
• Variable air volume VAV.
• Variable refrigerant flow VRF.
• Workplace air conditioning.