Unitary's Record-Breaking Streak at Risk

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Before the 13 SEER mandate went into effect last January, multiple predictions were made as to where the shipment numbers would end up in 2006. Many expected a correction to occur as shipments in late 2005 and early 2006 were off the charts. Currently, shipments are teetering below 2004’s 7.4 million total and threatening to interrupt HVAC’s four-year, record-breaking streak. November proved to be a big correction as U.S. factory shipments, totaling 336,027 units, were down 47 percent from Nov. 2005. This left the year-to-date total - 6,675,631 - down 17 percent from Jan.-Nov. 2005 totals.

Heat pump shipments also dropped, leveling out the yearly totals. Totaling 114,342 units shipped, heat pump shipments decreased 32 percent from Nov. 2005, leaving year-to-date totals at 1,984,656, just 0.6 percent higher than Jan.-Nov. 2005 totals.

The unprecedented shipment spike in January of last year started the ball rolling as the new 13 SEER law went into effect. After that, the market experienced a shift in trends towards heat pumps, as energy prices soared and sprawling new construction made utility infrastructure availability an issue.

Construction continues to be an influencing factor on unitary shipments. Residential construction has experienced a steady drop for much of 2006, and it is predicted that this trend will continue. However, some see both good and bad in the numbers.

“I expect to keep using both hands in 2007,” said Ken Simonson, chief economist for the Associated General Contractors of America (AGC). He pointed out that there was good news mixed with the seemingly gloomy construction spending report from the Census Bureau, Jan. 3, 2007.

“There has been no letup in the torrid pace of private nonresidential spending growth,” Simsonson stated. “Energy- and power-related construction, hotels, hospitals, and rental housing will all perform well, while single-family and condo construction will sink the totals.”

Publication date: 01/22/2007

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