Analysis of the North American HVAC Equipment Market


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With space heating and cooling accounting for close to 40 percent of all the energy consumed in the building sector in the United States, there is a pressing need for energy-efficient heating, ventilation and air conditioning (HVAC) equipment. Due to the economic downturn, building owners and facility managers deferred equipment replacements, but with the markets bouncing back, they are gradually unfreezing their budgets. Additionally, replacement HVAC purchases will get a leg up from the aging of commercial, institutional and industrial buildings.

New analysis from Frost & Sullivan's ( Analysis of the North American HVAC Equipment Market research finds the market earned revenue of $13.05 billion in 2012 and estimates this to reach $14.78 billion in 2017.

For more information on this research, please email Britni Myers, Corporate Communications, at, with your full name, company name, job title, telephone number, company email address, company website, city, state and country.

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Analysis of the North American HVAC Equipment Market

  1. 1. Analysis of the North American HVAC EquipmentMarketIncreasing Demand for Energy Efficient Equipment Drives GrowthNC35-19
  2. 2. 2NC35-19ContentsSection Slide NumbersExecutive Summary 4Market Overview 11Total Market -• External Challenges: Drivers and Restraints 22• Forecasts and Trends 34• Market Share and Competitive Analysis 55Unitary Equipment Segment Breakdown 65Applied Systems Segment Breakdown 75Chillers Segment Breakdown 85The Last Word (Conclusions and Implications) 95Appendix 98
  3. 3. 3NC35-19Executive Summary• The North American heating, ventilation, and air conditioning (HVAC) equipment market in2012 increased by1.8 percent over the previous year.• Although the market declined in 2009 and 2010, it is expected to experience steady growththrough 2017—the end of the forecast period.• The market is forecast to have a compound annual growth rate (CAGR) of 2.5 percent from2012 to 2017.• The key drivers are the need to increase energy efficiency and achieve energy savings andreplace equipment.• On the other hand, the key restraints are intense competition, high initial cost, and—in theshort term—the state of the economy.• The unitary segment is expected to increase its share of the market revenue as the trendtoward smaller and more economical units continues.• All segments of the market are expected to see an upward growth trend during the forecastperiod.• Research and development efforts are likely to continue to focus on making the equipmentmore energy efficient and lowering the noise levels.Source: Frost & Sullivan
  4. 4. 4NC35-19Executive Summary (continued)• Another major market trend is the use of controls to increase the efficiency of the overallsystem rather than focusing only on the efficiency of the components.• Although modest growth is expected in all verticals, the institutional vertical is expected towitness the highest growth during the forecast period.• The commercial and industrial segments are expected to show more growth potentialtoward the end of the forecast period.• The market is characterized by traditional distribution channels such as manufacturerrepresentatives, 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
  5. 5. 5NC35-19Executive Summary—CEO’s Perspective2A shift toward more energy-efficientequipment will continue throughout theforecast period.3The unitary equipment segment willwitness the highest growth andincrease its share of the market.4The institutional vertical presents agood opportunity for growth during theentire forecast period.5The water-cooled chillers segment willcontinue to lose share to the air-cooledchiller segment.1Frost & Sullivan expects economicrecovery and the revitalization of theconstruction market to drive growthafter 2011.Source: Frost & Sullivan
  6. 6. 6NC35-19Drivers and RestraintsDenotes long-term impactDenotes current impactKey Takeaway: Energy efficiency is the most important factor in product development.Total HVAC Equipment Market: Key Market Drivers and Restraints, North America, 2013-2017DriversRestraintsDriversRestraintsEnergyefficiency andcost savingsRetrofits/replacementsPolicy andenergymandates Increasing indoorair quality (IAQ)ConcernsIntense competition High initial costLong product life EconomicenvironmentRestraintsDriversRestraintsDriversSource: Frost & Sullivan
  7. 7. 7NC35-19Market Engineering MethodologyOne of Frost & Sullivan’s core deliverablesis its Market Engineering studies. Theyare based on our proprietary MarketEngineering Methodology. This approach,developed across the 50 years ofexperience assessing global markets,applies engineering rigor to the oftennebulous art of market forecasting andinterpretation.A detailed description of the methodologycan be found here.Source: Frost & Sullivan
  8. 8. 8NC35-19Additional Sources of Information on HVAC EquipmentMarketSource: Frost & Sullivan• 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 VerticalIndustries