Key Transitions In The Air Conditioning Market

AUSTIN, Texas - Believe it or not, not all HVACR contractors know about the new 13 SEER standard effective in January 2006. Of those who are aware, not all know the implications. These issues were addressed at a seminar on transitioning to 13 SEER, presented to attendees of the ACCA 37th Annual Conference & Indoor Air Expo in Austin.

Emerson Climate Technologies' Karl Zellmer, vice president of sales and Tim Fletcher, branding manager for A/C contractors, hosted the seminar.

Zellmer told attendees that Emerson had recently polled contractors and found that only 80 percent of them knew of the 13 SEER changeover. There may be a problem for those who are not prepared for the change, especially if contractors look at the size differences of the new 13-SEER products.

Tim Fletcher (left) and Karl Zellmer answer questions from contractors after their transitions seminar at the ACCA conference.

Size Matters

"There is a 40-percent size increase from a 10-SEER condensing unit to a 13-SEER unit," Zellmer said. The size of the unit affects all aspects of the business, he noted. He gave the example of warehousing space, which will now be 40 percent "smaller." And more trucks will be needed to transport the larger units.

Zellmer said there is about a 15-percent size increase from a 12-SEER unit to a 13-SEER unit. Along with the bigger sizes, there will be higher costs. Zellmer isn't sure that consumers will like to dig deeper into their pockets.

"There might be a trend toward more unit repairs over replacements," he said. "Consumers will question whether the unit really needs to be replaced."

Zellmer also discussed another trend in the market - the move to R-410A refrigerant. Unlike the 13 SEER mandate, the move to R-410A as a replacement product will not be in full effect until 2020, possibly sooner. R-22 is still the preferred refrigerant and, according to Zellmer, R-410A represents only 8 percent of the market today.

However, he noted Wal-Mart has required that all of its rooftop units run on R-410A. And last year, Wal-Mart represented one-third of the new commercial construction market in the United States.

"There are 9 million compressors running on R-22 today," said Zellmer. "By 2010, 10 million compressors will run on R-410A."

Product Differentiation

Fletcher talked about three major trends that will give contractors the opportunity to differentiate themselves from their competitors:

1. 13 SEER - Making sure contractors are ready for the change before the competition is.

2. Alternate refrigerant - Time to change system specs when planning a project.

3. Product differentiation/selling up - Opportunities for selling additional products (add-ons) which involves more technician training.

"Selling up involves comfort, improved reliability/diagnostic capabilities, and sound (low noise)," Fletcher said. "This is going to be a different way of selling equipment and more training will be required."

Publication date: 04/11/2005

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