Global demand for HVAC equipment is projected to rise 6.2 percent per year through 2014 to $93.2 billion, according to a report by the Freedonia Group. Demand is expected to benefit from recovery in the key U.S. market, which Freedonia believes will rebound from dismal levels in 2009. Demand growth in the Asia/Pacific region is predicted to outpace the global average, increasing 7.1 percent per year through 2014. China will be the fastest growing national market and comprise about 40 percent of the growth in global demand. Above-average growth is also expected to occur in India due to solid gains in building construction expenditures, a growing number of households, and rising per capita incomes.

WORLD HVAC EQUIPMENT DEMAND

(million dollars)

% Annual Growth

Item

2004

2009

2014

2004-

2009

2009-

2014

World HVAC Equipment Demand

55650

68900

93200

4.4

6.2

North America

13850

13660

19710

-0.3

7.6

Western Europe

12195

12270

14230

0.1

3.0

Asia/Pacific

22070

33020

46600

8.4

7.1

Other Regions

7535

9950

12660

5.7

4.9

© 2010 by The Freedonia Group, Inc.

Despite a modest outlook in the shorter term, U.S. demand for HVAC equipment is expected to rise 8.1 percent per year through 2014. Gains will result from recovery in residential building construction expenditures, which plummeted in 2009 due to the economic recession. Advances in other developed areas, such as Canada and Japan, are predicted to be slower, reflecting high penetration rates and modest gains. Low air conditioning system ownership rates in Western Europe (relative to other industrialized nations) will present opportunities, although gains will be limited by below-average growth in building construction expenditures.

Cooling equipment growth will continue to outpace heating equipment gains through 2014, reflecting the lower penetration rates of air conditioning equipment. Among products, room air conditioners will post the strongest gains worldwide. Rising income levels in Asia, especially China, will bolster demand for room air conditioners. In Western Europe, mini-split room air conditioners will post solid advances due to the lack of ductwork in most European homes. Other cooling equipment such as chillers will post solid demand gains due to rising nonresidential construction expenditures.