Air condition market size was valued at USD 110.67 Billion in 2023. The air condition market industry is projected to grow from USD 118.57 Billion in 2024 to USD 202.31 Billion by 2032, exhibiting a compound annual growth rate (CAGR) of 6.91% during the forecast period (2024 - 2032). Increasing demand for commercial buildings and consumers' increased preference for comfort and convenience are the key market drivers enhancing the air condition market growth.
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
As per market dynamics, the population growth anticipated to have a favorable impact on residential and commercial construction is also likely to result in a rise in demand for the air condition market. For instance, it's expected that the increased population in Gulf nations will greatly impact construction spending there. By 2050, the Region's population is predicted to increase from 350 million to over 600 million. To assist communities, this is anticipated to spur growth in infrastructure and building-related activities, particularly in housing, healthcare, and educational facilities.
Further, nearly 20% of the electricity consumed in buildings worldwide today is spent on ACs and electric fans for cooling purposes. Increased demand for space cooling is increasing emissions and putting tremendous strain on electrical infrastructure worldwide. There is little question that the need for energy to provide space cooling will increase significantly over the coming decades unless strong governmental interventions are made.
Figure 1: air conditioner stock, 1990-2050 
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Additionally, according to the IEA, the number of households using air conditioners could reach about 2/3 of all homes by 2050. Half of the total will comprise China, India, and Indonesia combined. ACs are growing more widespread as wages rise and people increase, particularly in the world's hottest regions. ACs and electric fans already account for 10% of all the electricity consumed globally or approximately a fifth of the total electricity utilised in buildings worldwide. The use of ACs is anticipated to increase dramatically during the following three decades, ranking among the main factors driving demand in the international market. Therefore, such rise in income and population has enhanced the air condition market CAGR across the globe in the recent years.
While AC sales are now concentrated in a small number of developed nations, they are accelerating in emerging economies, which is another factor driving the growth of the air condition market revenue.
The air condition market segmentation, based on application, includes commercial, residential, institutional, industrial, and others. The commercial segment held the majority share in 2021 contribution to around ~50-53% in respect to the air condition market revenue. This is primarily owing to the rising urbanization and rise in demands for commercial space.
November 2022: The commercial air-conditioning business from Systemair AB will be acquired by Panasonic Corporation's Heating & Ventilation A/C Company for a 100 million Euro enterprise value.
Figure 2: Air Condition Market, by Grade, 2021 & 2030 (USD Million)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
The second fastest-growing segment in the air condition industry is residential. In recent years, temperatures have risen in several nations due to climate change. Air conditioning systems have become less of a luxury and more of a necessity due to rising temperatures. Customers are installing AC systems in their homes as a result, and this trend is anticipated to continue to develop as temperatures climb.
The market based on product type, is segmented into, split, rooftop, indoor packaged, chillers ACs, and others. The split ACs segment dominated the market in 2021 and is projected to be the faster-growing segment during the forecast period, 2022-2030. Split ACs use less energy, are more energy-efficient, and contribute to a clean environment. The significant market share of this category is mostly due to the rising demand for energy-efficient ACs and low noise levels. Hence, the factors mentioned positively impact the air condition market growth.
The second fastest-growing segment in the air condition industry is rooftop ACs. Rooftop ACs come with multiple benefits which are driving the segmental demand, such as versatility, compactness, avoidance of accidental damage, silent operation, and easier accessibility.
The air condition market data has been bifurcated by ducts into ductless and ducted ACs. The ductless segment dominated the market in 2021 and is projected to be the faster-growing segment during the forecast period, 2022-2030. As per the market forecast, the ductless segment dominated the market in 2021 and is projected to be the faster-growing segment during 2022-2030. Ductless ACs key benefits are their compact size and flexibility in zoning and cooling specific rooms. One outdoor unit may be connected to as many as four indoor air handling units (for four zones or rooms) in many types. The amount depends on how much cooling the building or each zone needs.
Ducted AC is the second fastest-growing segment in the market. The degree of control you have over the system is one of its many wonderful benefits. The use of ducted systems not only makes it possible to chill an entire home, but some systems also let users regulate the temperature of each room separately. If no one is utilizing the zones, one can switch them off to save energy. The temperature in various areas of the house can also be altered.
By region, the study provides the market insights into North America, Europe, Asia-Pacific, and the Rest of the World. As per market statistics, the Asia-Pacific hard disk market accounted for USD 43724.6 million in 2021 and is expected to exhibit a 45.80% CAGR during the study period. The APAC air conditioning market is anticipated to rise steadily due to China's and India's residential and commercial construction activity and rising consumer spending on luxury products. Additionally, it is anticipated that the Asia-Pacific region's low ownership rate and rising disposable income will favorably affect market growth. Due to rising demand from China and India, a sizeable portion of the APAC market comprised the residential sector.
Further, the major countries studied in the market report are the U.S, Canada, Germany, France, UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.
Figure 3: AIR CONDITION MARKET SHARE BY REGION 2021 (%)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Replacement sales are likely to drive growth in the North American air condition market as well as other developed economies around the world. Additionally, it is anticipated that increasing government promotional efforts to encourage the adoption of energy-efficient air conditioning equipment will accelerate the regional air condition market expansion. Further, the US air condition market held the largest market share, and the Canada air condition market was the fastest-growing market in the region.
European Pacific air condition market accounts for the second-largest market share.With a drop in demand for air conditioning systems of more than 10% in 2020, the Middle East and Africa felt the COVID-19 pandemic's effects the most severely. Sales fell due to travel restrictions imposed by various nations, which harmed the economies of the Middle Eastern nations. With significant international events like the FIFA World Cup in Qatar in 2022 scheduled there, the Region is likely to recover quickly, encouraging new construction, which is expected to drive the regional growth of the market. Moreover, Germany air condition market held the largest market share, and the UK air condition market was the fastest-growing market in this region.
Major market players are spending a lot of capital on R&D to increase their product lines, which will help the air condition market grow even more. Market participants are also taking a range of strategic majors to extend their footprint, with key market developments such as new product launches, contractual agreements, mergers and acquisitions, increased investments, and collaboration with other organizations. As per market competitive landscape, players in the air condition industry must offer cost-effective items to expand and survive in an increasingly competitive and rising market environment.
One of the primary business strategies adopted by manufacturers in the air condition industry to benefit clients and extend the sector is to produce locally to decrease operating costs. In recent years, air condition industry has provided medicine with some of the most significant benefits. The air condition market major player such as AB Electrolux (Sweden), Carrier Corporation (USA), Daikin Industries Ltd. (Japan), and others are working to improve the market demand by investing in research and development activities.
Carrier Corporation (USA), With a top-notch, diversified staff, Carrier is the leading supplier of wholesome, secure, and environmentally friendly building and cold chain solutions. The business has been at the forefront of developing novel technology and new sectors from the start. In June 2022, The forthcoming 2023 Department of Energy (DOE) minimum efficiency requirements and test methods were met by a new line of single-stage split system air conditioners from Carrier. Before the January 1, 2023 installation cutoff for air conditioners supplied in the Southern areas, it is essential that Carrier's most recent launch completely converts inventory in the South to 2023 compliant items.
Also, AB Electrolux (Sweden) For over a century, the world's top appliance manufacturer, Electrolux, has improved living. Fifty-two thousand people were employed globally at Electrolux in 2021, which had sales of SEK 126 billion. Their corporate headquarters are in Stockholm, Sweden, and Nasdaq OMX Stockholm is where the Electrolux share (ELUXb) is traded. In July 2022, Electrolux announced that they are re-entering the Indian market via setting up an exclusive retail store at Saket, Delhi.
AB Electrolux (Sweden)
Carrier Corporation (USA)
Daikin Industries Ltd. (Japan)
Daikin Airconditioning India Pvt. Ltd. (India)
GE Appliances (USA)
Gree Electric Appliances Inc. (China)
LG Electronics (South Korea)
Midea Group (China)
Mitsubishi Heavy Industries Ltd. (Japan)
Panasonic Corporation (Japan), among others
Air Condition Industry Developments
January 2022: On display at the 2022 AHR Expo in Las Vegas was LG Electronics USA's new, extensive 2022 array of residential, light commercial, and commercial HVAC solutions.
November 2020: Panasonic planned to invest in domestic manufacture in India by doubling its AC business over the following three years. The company, which debuted the HU series of ACs with the just-announced nanoeX technology, anticipates a 35% increase in sector sales this year due to pent-up demand. The company claims that nanoeX technology releases hydroxyl radicals, also known as "nature's detergent," which are found in water and can kill bacteria and viruses, including 99.99% of attached new coronaviruses.
On Aug.23, 2022, Pigmentum (Israel), a start-up involved in protein, pigment, and aroma production in a greenhouse, announced that it is producing biomolecules for the food industry in transgenic plants.
Replacing synthetic compounds such as colorants and aromas with their natural counterparts increases reliance on traditional agricultural systems. The company is taking a more sustainable approach to producing biomolecules, leveraging transgenic modification and molecular farming methods to produce high yields of natural compounds for the food industry.
On Feb.03, 2022, the United States Department of Agriculture National Institute of Food and Agriculture (USDA-NIFA) awarded a $637,000 grant to an associate professor of plant genomics from North Carolina State University to increase anthocyanin content in purple carrots and to increase anthocyanin longevity in food products. Due to their accumulation of large quantities of more-stable anthocyanin compounds, purple carrots are a promising source of anthocyanins for food colorants.
On May 14, 2021, CenterOak Partners LLC, a private equity firm, announced that it has rebranded its portfolio company, Aakash Chemicals & Dyestuffs, Inc., to Vivify Specialty Ingredients, uniting three subsidiaries under a new name. The Vivify brand results from the company's two recent acquisitions and expanding capabilities across various end markets under CenterOak's ownership.
Vivify supplies specialty colorants and functional ingredients required in the food & beverage, personal care & cosmetics, packaging, plastics, coatings, and seed treatment industries. The rebranding reflects CenterOak's accelerated growth, showcasing its leadership in the specialty colorants and ingredients industry across multiple end markets.
On Aug. 29, 2019, DIC Corporation (Japan), a leading chemical company, announced entering into a definitive agreement to acquire BASF Colors & Effects (BCE – the US), a global pigment business. The acquisition will position DIC as a world-class pigment supplier that offers customers an even wider range of versatile solutions. The deal would further broaden DIC's portfolio as a global manufacturer of pigments used in cosmetics, electronic displays, coatings, plastics, inks, and specialty applications.
The acquisition of BCE brings together complementary resources and expertise of two recognized leaders in innovation, product stewardship, regulatory leadership, application support, and manufacturing.
| Report Attribute/Metric | Details |
| Market Size 2023 | USD 110.67 Billion |
| Market Size 2024 | USD 118.57 Billion |
| Market Size 2032 | USD 202.31 Billion |
| Compound Annual Growth Rate (CAGR) | 6.91% (2024-2032) |
| Base Year | 2021 |
| Market Forecast Period | 2024-2032 |
| Historical Data | 2018 & 2020 |
| Market Forecast Units | Value (USD Billion) |
| Report Coverage | Revenue Forecast, Market Competitive Landscape, Growth Factors, and Trends |
| Segments Covered | Application, Product Type, Ducts, and Region |
| Geographies Covered | North America, Europe, Asia Pacific, and Rest of the World |
| Countries Covered | The U.S, Canada, Germany, France, UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil |
| Key Companies Profiled | AB Electrolux (Sweden), Carrier Corporation (USA), Daikin Industries Ltd. (Japan), Daikin Airconditioning India Pvt. Ltd. (India), GE Appliances (USA), Gree Electric Appliances Inc. (China), LG Electronics (South Korea), Midea Group (China), Mitsubishi Heavy Industries Ltd. (Japan), Panasonic Corporation (Japan) |
| Key Market Opportunities | Emergence of biomaterial Air Condition implants |
| Key Market Dynamics | Rising prevalence of cervical spondylosis in corporate professionals Growing cases of cervical injuries in automobile crashes |
Air Condition Market Highlights:
Frequently Asked Questions (FAQ) :
The market size was valued at USD 118.57 Billion in 2023.
The market is projected to grow at a CAGR of 6.91% during the forecast period, 2024-2032.
Asia Pacific had the largest share in the market.
The key players in the air condition market are Medtronic Inc. (Ireland), Abbott Laboratories (US), Stryker AB Electrolux (Sweden), Carrier Corporation (USA), Daikin Industries Ltd. (Japan), Daikin Airconditioning India Pvt. Ltd. (India), and GE Appliances (USA)
The commercial air condition category dominated the market in 2021.
The rooftop air condition had the largest share in the market.
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