Market Trends of China HVAC Industry
HVAC Equipment Segment Holds Significant Market Share
- The fast-increasing industrial sector in China is one of the primary causes responsible for the most significant share. It is also anticipated that growing urbanization and commercialization in the country will raise demand for HVAC equipment. Additionally, rising disposable income and a higher standard of life drive demand for pleasant living spaces, which will drive market growth.
- The demand for air conditioners in China is increasing due to several factors, such as the availability of various product options, continuous technological advancements, and the presence of significant players like Media Group.
- The demand for AHUs is also increasing as they are utilized in factories and other work environments that deal with flammable gases. In areas with flammable gases, sparks produced by an electrical apparatus could lead to an explosion. Hence, explosion-resistant devices or air-handling units are implemented in these settings.
- Furthermore, the construction industry has become a key sector of China's economy, contributing to approximately 7 % of the country's GDP, largely due to the boost from housing developments and infrastructure projects.
- Thus, the growing construction of industrial, commercial, and residential spaces in the country will increase the demand for HVAC equipment and services. According to the National Bureau of Statistics of China, in 2023, the construction industry in China generated an output of over CNY 31 trillion (USD 4.35 trillion), representing an increase of almost 100 % from a decade ago.
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Residential Segment Holds Significant Market Share
- The HVAC market in China is growing owing to the rising demand for air conditioning equipment in the residential sector. The demand is growing due to rising temperatures and humidity levels in the area, along with consumers' increasing desire for convenience and comfort.
- Moreover, the government is taking the initiative and investing in building renovation projects in the country, further driving the demand for the country's HVAC services and equipment market. For instance, in November 2023, the government of China announced allocating USD 137 billion in affordable financing for urban village renovation and affordable housing programs, marking its latest move to stabilize the weakening property market.
- Additionally, there has been a significant increase in government-led building renovation projects aimed at improving energy efficiency, which is gaining traction in the China HVAC market. Energy-efficient buildings can reduce greenhouse gas emissions, decrease homeowners' energy costs, and enhance indoor air quality, thereby promoting public health.
- In 2023, China's National Bureau of Statistics reported that the country's production volume of air conditioners reached 233 million units, approximately 22 million units higher than the previous year. China maintained its position as one of the leading global producers of consumer electronics, thus supporting the market's growth.
- Moreover, there has been a substantial rise in residential space heating in urban Southern China over the past ten years, bringing about notable sustainability issues. Consequently, heat pumps have become increasingly popular in the area and are extensively utilized throughout China.
- Air-source and ground-source heat pumps have gained a considerable share of the market and are experiencing an increasing acceptance rate. The Chinese government has been instrumental in driving this trend forward through initiatives such as the coal-to-electricity project. The growing popularity of heat pumps in China is expected to bolster the market's expansion.
- Furthermore, several regional players are expanding their presence in the country's HVAC market, thus supporting the market growth. For instance, in June 2023, Panasonic and Xiaomi announced a partnership to manufacture air conditioners for the Chinese Market. Panasonic plans to leverage its manufacturing and quality control knowledge to support Xiaomi's growing air conditioning operations.
