Split Systems Market Size (2024 - 2029)

Split Systems Market Analysis

The Split Systems Market is expected to register a CAGR of 4.88% during the forecast period.

The split systems market was valued at USD 99.06 billion in the previous year and is expected to grow 4.88% during the forecast period, owing to the demand for energy-efficient and environmentally friendly products and the increasing adoption of air conditioning in residential and commercial applications. Adequate heating and cooling are essential to human health and productivity and are becoming more important globally due to urbanization, the growing economy, and the increasing need for cooling due to extreme weather conditions in different regions.

• The rapid rise in industrialization and urbanization around the world is one of the primary factors driving market growth. The significant increase in the construction of different commercial and residential buildings worldwide is creating considerable demand for split systems such as space heating and cooling systems, ventilation control, humidity control, as well as air filtration. For instance, as per the Oxford Economics report on A Global Forecast for Construction to 2030, the global construction market is expected to grow by USD 4.5 trillion over the decade to 2020 to reach USD 15.2 trillion.
• According to the CIA - World Fact Book, the global population amounts to around 7 billion people, and more than half of the global population is living in Asia, while one-quarter of the global population resides in Africa. Moreover, three out of five of the most populous countries in the world are located in Asia. Ultimately, the highest population growth rate is also found there. As urban populations continue to grow, the increased demand for ACs has put a strain on global energy systems. AC cooling systems have made cities and built environments more hospitable in otherwise hot and humid climates. According to the International Energy Agency (IEA), the number of AC units in buildings across the world is projected to hit 5.6 billion by 2050. 
• The residential demand for split systems has also been gaining momentum as there are various benefits like energy efficiency, cost-effectiveness, and quite operations, enclosed with the split systems that make it a suitable alternative for customers in regard to the other air conditioners prevailing in the market. In addition to this, the growing number of manufacturing plants, expansion, and investments have also been paving the way for multiple opportunities to enter the market.
• The high initial cost of split air conditioners can be challenging for its demand because it may deter some customers from purchasing or upgrading their systems. This is especially true for homeowners or small business owners who may have limited budgets and may not be able to afford the upfront costs of a new system. Secondly, the high cost of split systems can result in longer payback periods for customers. This means that the cost savings that result from the improved energy efficiency of the new system may not offset the initial investment for several years. This is expected to challenge the market's growth.
• However, rising energy costs directly impact the profit/loss statements of building owners and tenants. Moreover, the invasion of Ukraine affected energy markets around the world, particularly in Europe, which remains the primary market for Russian oil and gas owing to the lack of these energy sources in European countries. However, as a consequence of Russia's invasion of Ukraine, the European Union decided to cut Russian oil imports by two-thirds, resulting in a surge in energy prices. Consequently, the demand for energy-efficient air conditioning systems has recently increased significantly.

Split Systems Market Industry Segmentation

A split system is an HVAC system that has both indoor and outdoor units that are connected with copper tubing. There are many different types of split systems, which can include either a heat pump or air conditioner installed outside your home, paired with either a gas furnace or a fan coil located inside your home.

The Split Systems Market is segmented by equipment type (mini-split, multi-split, variable refrigerant flow (VRF)), by application (residential, commercial), by geography (North America (United States, Canada), Europe (United Kingdom, Germany, France, Spain, Eastern Europe, and the Rest of Europe), Asia-Pacific (China, Japan, India, South Korea, and the Rest of Asia-Pacific), and Middle East and Africa). The report offers market forecasts and size in value (USD) for all the above segments.