Commercial HVAC Equipment in Demand
Market forecast to reach $12.3 billion by 2021
Demand for HVAC equipment in commercial buildings is projected to advance 3.3 percent per year through 2021 to $12.3 billion with 58 percent of all HVAC equipment sales. Although larger than the residential market, commercial demand gains will increase at a slower rate due to an expected slowdown in commercial construction activity.
Competition from used equipment will also restrain sales growth in this market. Still, opportunities for equipment sales will continue to be supported by the need to replace aging equipment. These and other trends are presented in “US HVAC Market Forecasts,” a new study from The Freedonia Group, a Cleveland-based industry research firm.
The commercial market will remain the larger market for HVAC equipment due to two factors:
• Commercial buildings often require the use of more than one HVAC unit to effectively cool the entire building, boosting the total number of units installed and creating a large potential replacement market; and
• Commercial HVAC equipment is generally more expensive than equipment used in the residential market, bolstering overall dollar sales.
US demand for HVAC equipment in all markets is forecast to increase 3.9 percent per year through 2021 to $21.2 billion. The majority of expected demand increases will come from ongoing replacement of existing equipment that has reached the end of its operational lifespan with better performing and typically higher value equipment. Shifts in the product mix toward more expensive HVAC equipment — such as away from room air conditioners to unitary air conditioners and from noncondensing cast iron boilers to condensing steel boilers — will provide further impetus to dollar gains.
For more information, visit www.freedoniagroup.com.
Publication date: 8/22/2017