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BSRIA Global Air Conditioning Study shows that market slowed down in 2015

The biggest PAC (packaged air conditioning) market, Asia-Pacific, accounting 61% of the world market by volume, declined by five per cent, says the study

| | Jun 12, 2016 | 11:43 am
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Berkshire, United Kingdom: According to a statement released by BSRIA, based on its recently published market intelligence study on the global air conditioning market, the global growth has “disappointed again” in 2015 – across all product ranges – and it is expected to recover at a slower pace than previously projected.

‘BSRIA Global Air Conditioning Study’, the statement said, has concluded that the global market contracted by five per cent in value terms in 2015, whereas the market had shown a growth of seven per cent in 2014. Furthermore, previous year’s main drivers in the increase in the Asia-Pacific region, were also key in the drop of the total world market in 2015, added the statement .

The study has revealed that the biggest PAC (packaged air conditioning) market, Asia-Pacific, accounting 61% of the world market by volume, declined by five per cent, while the top four biggest markets – China, Japan, Indonesia and South Korea have all contracted and contributed to the downward trend.

Analysing the market region-wise, BSRIA study shows that 2015 has been a turbulent year for China, with low GDP growth, volatile markets, declining imports and exports, depreciation of its currency, raising concerns about non-performing debts and low raw material prices, all of which had a negative impact in the air conditioning market. The PAC market, the study highlighted, has reached 49.3 million units, down by seven per cent compared to 2014, while the mini-VRF (20kW) was the only market that has managed to grow amongst PAC products due to the growing demand from residential applications.

“The bit of good news from the region came from Vietnam, Australia and Philippines. The growing GDP and attractive economic characteristics mean the Vietnamese market has good potential for Foreign Direct Investments,” said Saziye Dickson, Senior Market Research Consultant at WMI.  “In the Philippines the solid growth of packaged products market is attributable to the flourishing new private construction especially the high rise condominium, commercial offices, shopping malls and other applications. In Australia, demand has grown in 2015 as a result of a strong residential market in both the apartment and housing sectors”

“However,” she added, “the growth in the splits market was mostly down to hot weather during the peak season and after-season.”

The study mentioned that the MEIA region has witnessed another year of growth in 2015, increasing from 11.6 million to 12.5 million units, with India continuing to be the biggest contributor in the region. Elaborating further, the study said that the market in India grew by four per cent in terms of volume and reached four million units, as a result of growing GDP, low raw material prices and resumption of projects which were on hold pre-election in 2014.

Other markets, namely Saudi Arabia, Nigeria*, Egypt, Iran, Bangladesh and South Africa were also amongst the growing markets in 2015. Meanwhile, the countries that failed to grow were United Arab Emirates, Kuwait and Qatar, as drop in oil prices, which these three countries heavily relies on, caused reduction in public spending, consequently impacting the air conditioning industry, added the study.

The PAC market in the United States, the study revealed, grew by four per cent and has reached 16.1 million units due to improved macroeconomic indicators, such as low unemployment, growth in GDP and increase in construction output.

Brazil, which had indicated 28% growth in 2014 and was the biggest contributor, contracted by 18% in 2015 due to political instability and economic downturn, added the study.

Focusing on the European PAC market, the study said that it grew by two per cent in 2015 compared to the previous year’s drop of 16% in volume terms. Analysing further, it said that most economies in the region started to show small economic recovery, with the impact felt across air conditioning industries; in addition, hot summer and energy efficiency were contributing factors. The new F-Gas regulation, which has been updated from 2006 version and came in place from January 1, 2015, has put a lot more pressure in the industry, added the study.

Touching upon other regions, the study highlighted that the growth in Spain, France, Italy, Turkey, Greece, Sweden and Germany has contributed to the growth in the region, in order of importance. The biggest PAC market, Russia, it revealed, has recorded a massive drop of 18% by volume, due to the sharp contraction in the country’s economy, devaluation of its currency  of over 50%, economic sanctions and low oil prices all had an impact on many industries including air conditioning.

To read the entire statement, please visit: https://www.bsria.co.uk/news/article/bsria-global-air-conditioning-study-shows-market-cooled-in-2015/

*Nigeria – this market was researched in 2014: no update was available in 2015.

This statement is based on the latest BSRIA’s World Air Conditioning Study, published in March 2016, covering 30 countries.

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