Report ID: PMRREP34550
Report Type: Ongoing
Format: PPT*, PDF, EXCEL
Industry: Industrial Automation
The North America HVAC equipment market is estimated to value US$40.3 Bn by the end of 2031 from US$29.6 Bn recorded in 2024. The market is expected to secure a CAGR of 4.5% in the forthcoming years from 2024 to 2031.
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Attributes |
Key Insights |
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Market Size (2024E) |
US$29.6 Bn |
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Projected Market Value (2031F) |
US$40.3 Bn |
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Forecast Growth Rate (CAGR 2024 to 2031) |
4.5% |
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Historical Growth Rate (CAGR 2019 to 2023) |
3.9% |
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The number of HVAC systems in the US has surpassed the number of people living there. This indicates the heating, ventilation, and air conditioning (HVAC) sector is expanding at a rate never seen before. Extreme weather, infrastructural advancements, and a growing emphasis on comfort are the primary drivers propelling the nation's HVAC industry expansion.
Household demand for air conditioning has increased due to the early occurrence of summer and the increased frequency of heat waves. In addition, the necessity for air conditioning is increasingly pressing as average temperatures climb. To keep their homes comfortable during the warmest months of the year, homeowners are now spending more money than ever on air conditioning units.
The effects of global warming increase beyond hot summers; they are also negatively affecting the winter months. According to a study on climate change, colder winter months in the US are associated with warming in the Arctic region. Thus, because of their versatility in usage throughout the year, heat pumps that can provide both cooling and heating are becoming more and more common.
The rapid advancement of technology has resulted in a steady increase in the penetration of smart home appliances into American households. Based on current data, it is anticipated that the percentage of smart homes in the US would surpass 68% by 2027, with a growth rate of around 56% between 2022 and 2027.
A significant amount of money can be saved on energy costs because of the advancement of smart home technology, which has also brought about an unprecedented amount of comfort. In the HVAC industry, smart technology is becoming more and more popular, as continuous use of air conditioning leads to much higher electricity expenditures.
Smart thermostats and smart AC controllers for room air conditioners are becoming more and more popular among homes looking to cut energy expenses. You can automate your home's environment and reduce your air conditioning costs with the many smart capabilities offered by these products.
Key Trends Shaping the Market
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The growing consumer inclination towards energy-efficient HVAC systems is a key trend in the North American HVAC equipment market. This trend is fuelled by growing environmental concerns, regulatory demands, and technological improvements.
The market is witnessing a robust shift towards systems that offer superior energy performance, aligning with stringent government regulations aimed at reducing carbon emissions and promoting sustainable practices.
The policies of the US Department of Energy and the implementation of the ENERGY STAR programme, which provides incentives for the use of energy-efficient products, have a significant impact on this trend.
The most recent recommendations for 2024 require air conditioners to have greater Seasonal Energy Efficiency Ratios (SEER), which is encouraging manufacturers to come up with new and more efficient models.
For instance, Daikin’s recent launch of high-efficiency heat pumps and Carrier’s new range of ultra-efficient air conditioning systems exemplify the industry's response to these regulatory demands.
Moreover, the increasing cost of energy and rising consumer awareness about the long-term savings associated with energy-efficient HVAC systems are further propelling the demand for energy-efficient HVAC equipment in the region. The adoption of smart HVAC systems, integrated with IoT and AI for optimized energy usage, is becoming more prevalent.
Technological advancements are also playing a critical role. Innovations such as variable refrigerant flow (VRF) systems and geothermal heating and cooling solutions are gaining traction due to their high efficiency and low environmental impact.
Additionally, the integration of renewable energy sources, like solar power with HVAC systems, is emerging as a sustainable solution, further enhancing energy efficiency and reducing dependency on traditional energy sources.
High Costs of HVAC Equipment
The high costs associated with HVAC equipment and a lack of a skilled workforce are significant restraints on the growth of the North American HVAC equipment market. The initial investment for advanced HVAC systems can be prohibitively high, with state-of-the-art units often costing several thousand dollars.
Additionally, the increasing complexity of HVAC technologies, including smart and energy-efficient systems, exacerbates the demand for skilled personnel with specialized training and expertise.
Growing Infrastructure Needs in Line with Population Growth
As urbanization accelerates and the population increases, the demand for residential, commercial, and industrial infrastructure is rising, driving substantial growth in the HVAC sector. Population growth in North America is a major driver of this trend.
The US Census Bureau projects the US population to reach nearly 400 million by 2050. This increase necessitates the construction of new housing, commercial buildings, and public infrastructure, all of which require efficient and effective HVAC systems.
The demand for HVAC equipment in residential construction is particularly notable, with a 2023 report from the National Association of Home Builders highlighting that new single-family home construction increased by 12% compared to the previous year.
Infrastructure development is also spurred by substantial government investments. The US Infrastructure Investment and Jobs Act, passed in 2021, allocates $1.2 trillion for upgrading and expanding infrastructure, including schools, hospitals, and public buildings.
The investment boosts demand for HVAC systems, as modern, energy-efficient equipment is essential for these projects. For instance, the act includes provisions for improving indoor air quality in schools, which will drive the need for advanced HVAC solutions.
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Category |
CAGR through 2034 |
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Air Conditioning Equipment |
6.9% |
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Residential |
6.7% |
Air Conditioning Equipment Sales Remain Dominant
The air conditioning equipment segment accounts for a significant market share and is likely to maintain its dominance during the forthcoming years recording a CAGR of 6.9%. This growth trajectory is further propelled by technological advancements, including the integration of smart and energy-efficient solutions.
Increasing consumer preferences towards sophisticated cooling systems is driving the growth and prominence of this market segment. The expansion of construction activities, coupled with the renovation and retrofitting of existing infrastructures, also contributes significantly to the demand for air conditioning equipment.
Residential Sector Marches Ahead in Demand Generation
The residential segment is anticipated to rise at a rate of around 6.7% over the course of the forecast period, and it is expected to represent a sizeable part of the North American HVAC equipment market in 2024.
In the US, air conditioning is present in over 90% of homes on average. The average temperature determines the variation in usage among cities. For example, air conditioning is installed in about 99% of homes in Miami, Atlanta, and Houston.
While Miami, and Atlanta see high 80s temps, Houston experiences average highs of 93 F in the months of June, and July. The growing demand for residential HVAC equipment is a sign of a healthy housing market that necessitates sophisticated HVAC installations, and it is influenced by both the trend toward urbanization and the expansion of the housing market.
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Region |
CAGR through 2034 |
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US |
4.6% |
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Canada |
5.3% |
The US Takes up a Significant Market Share
The US is the most significant shareholding country in the region and is likely to grow at a CAGR of 4.6% during the forecast period. This increasing consumer awareness regarding indoor air quality and comfort primarily drives adoption of advanced HVAC solutions.
Furthermore, government initiatives promoting energy efficiency and sustainability, such as the ENERGY STAR program, and regulations like the Clean Air Act, further bolster the demand for high-performance HVAC equipment in the US market.
Canada to Exhibit a Notable CAGR Through 2031
The Canadian HVAC system market is projected to secure a CAGR of 5.3% in the forecast period from 2024 to 2031.
Factors such as government initiatives promoting green building standards and the replacement of outdated HVAC systems with modern, energy-efficient alternatives are driving the demand for HVAC equipment in the country.
Moreover, the country's harsh winters and variable climate necessitate robust heating and ventilation solutions, further stimulating market demand.
Key players in the market include multinational corporations such as Carrier Global Corporation, Daikin Industries Ltd., Trane Technologies plc, Johnson Controls International plc, and Lennox International Inc. are adopting several strategies, such as strategic collaborations, mergers, and acquisitions to enhance their market presence and expand their product offerings.
With increasing emphasis on energy efficiency, environmental sustainability, and smart technologies, manufacturers are also focusing on the introduction of new products with low environment impact.
Recent Developments in the HVAC Equipment Market
May 2024
Lennox International Inc. announced the introduction of its ducted residential and light commercial HVAC equipment. These products are made to use lower-GWP refrigerants in order to comply with US Environmental Protection Agency (EPA) refrigerant standards that go into effect in 2025. R-454B, a refrigerant with a GWP that is up to 78% lower than certain present refrigerants, will be used in the new HVAC products.
April 2024
A brand-new line of creatively redesigned, eco-friendly, and low-GWP household items, optimised for compatibility with R-454B, was introduced by Johnson Controls.
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Attributes |
Details |
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Forecast Period |
2024 to 2031 |
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Historical Data Available for |
2019 to 2023 |
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Market Analysis |
US$ Billion for Value Units for Volume |
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Key Countries Covered |
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Key Market Segments Covered |
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Key Companies Profiled |
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Report Coverage |
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Customization & Pricing |
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The increasing incidence of heat waves and extended summers, coupled with the rising demand for energy-efficient HVAC systems is surging the demand.
Some of the key players operating in the market are Johnson Controls International PLC, Daikin Industries Ltd., Lennox International Inc., Electrolux AB, among others.
The air conditioning equipment segment recorded a significant market share.
Growing infrastructure needs, population growth, and changing lifestyles is estimated to present opportunities for the market players.
The US accounts for a significant share of the market.
