HVAC Market
Content
Analysis of the North American HVAC Equipment
Market
Increasing Demand for Energy Efficient Equipment Drives Growth
NC35-19
Contents
Section
Slide Numbers
Executive Summary
4
Market Overview
11
Total Market
-
• External Challenges: Drivers and Restraints
22
• Forecasts and Trends
34
• Market Share and Competitive Analysis
55
Unitary Equipment Segment Breakdown
65
Applied Systems Segment Breakdown
75
Chillers Segment Breakdown
85
The Last Word (Conclusions and Implications)
95
Appendix
98
NC35-19
2
Executive Summary
• The North American heating, ventilation, and air conditioning (HVAC) equipment market in
2012 increased by1.8 percent over the previous year.
• Although the market declined in 2009 and 2010, it is expected to experience steady growth
through 2017—the end of the forecast period.
• The market is forecast to have a compound annual growth rate (CAGR) of 2.5 percent from
2012 to 2017.
• The key drivers are the need to increase energy efficiency and achieve energy savings and
replace equipment.
• On the other hand, the key restraints are intense competition, high initial cost, and—in the
short term—the state of the economy.
• The unitary segment is expected to increase its share of the market revenue as the trend
toward smaller and more economical units continues.
• All segments of the market are expected to see an upward growth trend during the forecast
period.
• Research and development efforts are likely to continue to focus on making the equipment
more energy efficient and lowering the noise levels.
Source: Frost & Sullivan
NC35-19
3
Executive Summary (continued)
• Another major market trend is the use of controls to increase the efficiency of the overall
system rather than focusing only on the efficiency of the components.
• Although modest growth is expected in all verticals, the institutional vertical is expected to
witness the highest growth during the forecast period.
• The commercial and industrial segments are expected to show more growth potential
toward the end of the forecast period.
• The market is characterized by traditional distribution channels such as manufacturer
representatives, contractors/distributors, and the direct channel.
• The largest distribution channel in this market is the manufacturer representative channel.
In fact, about 71.9 percent of HVAC equipment is distributed through this channel.
Source: Frost & Sullivan
NC35-19
4
Executive Summary—CEO’s Perspective
1
Frost & Sullivan expects economic
recovery and the revitalization of the
construction market to drive growth
after 2011.
2
A shift toward more energy-efficient
equipment will continue throughout the
forecast period.
3
The unitary equipment segment will
witness the highest growth and
increase its share of the market.
4
The institutional vertical presents a
good opportunity for growth during the
entire forecast period.
5
The water-cooled chillers segment will
continue to lose share to the air-cooled
chiller segment.
Source: Frost & Sullivan
NC35-19
5
Drivers and Restraints
Key Takeaway: Energy efficiency is the most important factor in product development.
Policy and
energy
mandates
Restraints
Restraints
Long product life
Intense competition
Economic
environment
High initial cost
Denotes current impact
Denotes long-term impact
NC35-19
Increasing indoor
air quality (IAQ)
Concerns
Restraints
Restraints
Retrofits
/replacements
Drivers
Drivers
Energy
efficiency and
cost savings
Drivers
Drivers
Total HVAC Equipment Market: Key Market Drivers and Restraints, North America, 2013-2017
Source: Frost & Sullivan
6
Market Engineering Methodology
One of Frost & Sullivan’s core deliverables
is its Market Engineering studies. They
are based on our proprietary Market
Engineering Methodology. This approach,
developed across the 50 years of
experience assessing global markets,
applies engineering rigor to the often
nebulous art of market forecasting and
interpretation.
A detailed description of the methodology
can be found here.
Source: Frost & Sullivan
NC35-19
7
Additional Sources of Information on HVAC Equipment
Market
• Analysis of the Market for Select HVAC Products in India
• North American HVAC Controls Market
• U.S. Residential Heating and Air conditioning Equipment Market
• Strategic Analysis of Green HVAC Industry in North America
• Strategic Analysis of Green Technologies Market - Energy Efficiency (HVAC,
BAS, and Lighting)
• U.S. Commercial and Institutional HVAC Equipment Markets
• North American Refrigeration Chillers Markets
• Energy-efficient HVAC and Lighting Equipment Market in South Africa
• The South African HVAC Market: An Analysis of the Top Five Vertical
Industries
Source: Frost & Sullivan
NC35-19
8
Market
Increasing Demand for Energy Efficient Equipment Drives Growth
NC35-19
Contents
Section
Slide Numbers
Executive Summary
4
Market Overview
11
Total Market
-
• External Challenges: Drivers and Restraints
22
• Forecasts and Trends
34
• Market Share and Competitive Analysis
55
Unitary Equipment Segment Breakdown
65
Applied Systems Segment Breakdown
75
Chillers Segment Breakdown
85
The Last Word (Conclusions and Implications)
95
Appendix
98
NC35-19
2
Executive Summary
• The North American heating, ventilation, and air conditioning (HVAC) equipment market in
2012 increased by1.8 percent over the previous year.
• Although the market declined in 2009 and 2010, it is expected to experience steady growth
through 2017—the end of the forecast period.
• The market is forecast to have a compound annual growth rate (CAGR) of 2.5 percent from
2012 to 2017.
• The key drivers are the need to increase energy efficiency and achieve energy savings and
replace equipment.
• On the other hand, the key restraints are intense competition, high initial cost, and—in the
short term—the state of the economy.
• The unitary segment is expected to increase its share of the market revenue as the trend
toward smaller and more economical units continues.
• All segments of the market are expected to see an upward growth trend during the forecast
period.
• Research and development efforts are likely to continue to focus on making the equipment
more energy efficient and lowering the noise levels.
Source: Frost & Sullivan
NC35-19
3
Executive Summary (continued)
• Another major market trend is the use of controls to increase the efficiency of the overall
system rather than focusing only on the efficiency of the components.
• Although modest growth is expected in all verticals, the institutional vertical is expected to
witness the highest growth during the forecast period.
• The commercial and industrial segments are expected to show more growth potential
toward the end of the forecast period.
• The market is characterized by traditional distribution channels such as manufacturer
representatives, contractors/distributors, and the direct channel.
• The largest distribution channel in this market is the manufacturer representative channel.
In fact, about 71.9 percent of HVAC equipment is distributed through this channel.
Source: Frost & Sullivan
NC35-19
4
Executive Summary—CEO’s Perspective
1
Frost & Sullivan expects economic
recovery and the revitalization of the
construction market to drive growth
after 2011.
2
A shift toward more energy-efficient
equipment will continue throughout the
forecast period.
3
The unitary equipment segment will
witness the highest growth and
increase its share of the market.
4
The institutional vertical presents a
good opportunity for growth during the
entire forecast period.
5
The water-cooled chillers segment will
continue to lose share to the air-cooled
chiller segment.
Source: Frost & Sullivan
NC35-19
5
Drivers and Restraints
Key Takeaway: Energy efficiency is the most important factor in product development.
Policy and
energy
mandates
Restraints
Restraints
Long product life
Intense competition
Economic
environment
High initial cost
Denotes current impact
Denotes long-term impact
NC35-19
Increasing indoor
air quality (IAQ)
Concerns
Restraints
Restraints
Retrofits
/replacements
Drivers
Drivers
Energy
efficiency and
cost savings
Drivers
Drivers
Total HVAC Equipment Market: Key Market Drivers and Restraints, North America, 2013-2017
Source: Frost & Sullivan
6
Market Engineering Methodology
One of Frost & Sullivan’s core deliverables
is its Market Engineering studies. They
are based on our proprietary Market
Engineering Methodology. This approach,
developed across the 50 years of
experience assessing global markets,
applies engineering rigor to the often
nebulous art of market forecasting and
interpretation.
A detailed description of the methodology
can be found here.
Source: Frost & Sullivan
NC35-19
7
Additional Sources of Information on HVAC Equipment
Market
• Analysis of the Market for Select HVAC Products in India
• North American HVAC Controls Market
• U.S. Residential Heating and Air conditioning Equipment Market
• Strategic Analysis of Green HVAC Industry in North America
• Strategic Analysis of Green Technologies Market - Energy Efficiency (HVAC,
BAS, and Lighting)
• U.S. Commercial and Institutional HVAC Equipment Markets
• North American Refrigeration Chillers Markets
• Energy-efficient HVAC and Lighting Equipment Market in South Africa
• The South African HVAC Market: An Analysis of the Top Five Vertical
Industries
Source: Frost & Sullivan
NC35-19
8
