A world perspective on air conditioning

Europe and the UK are very small players in the world air-conditioning market, which is generally showing signs of recovery. BSRIA’s Saziye Dickson discusses how the market, including the UK, is developing.

The world air-conditioning market is showing signs of growth. It was valued at €69.0 billion in 2013 compared with €66.8 billion in 2012. Asia Pacific is still the largest world region in terms of air-conditioning sales with US$51.7 billion, or 56% of the world market in 2013. Within the region, as previous years, China and Japan represented 82% of this market by value.

In contrast to 2012, there was a recovery in many markets in 2013. The biggest growth was seen in Argentina, Vietnam, Brazil and South Africa. The growth was due to several factors — general economic growth, transition from R22 to R410A resulting in higher sales prices, and increases in average selling prices due to currency fluctuations in local currencies against the Euro and US$, and in Brazil the boost of forthcoming sporting events such as the football world cup 2014 and the Olympics in 2016.

The US has also seen a recovery and the total air-conditioning market grew by 6% in value to reach almost US$12.8 billion in 2013. The growth was primarily generated by a strong performance of the domestic demand and from a reduction of the fiscal drag after the most recent adjustments in the public budget.

Europe is in slow recovery, with any significant change not expected until 2015. Out of the top seven countries (Russia, Italy, Germany, Turkey, France, UK and Spain), only Italy and Spain declined in 2013. The top seven countries comprise 70% of the European market by value. Energy-efficiency driven legislation continues to add to the strain in the market — including the potential switch to new refrigerants such as R32 and tax threats on HFCs.

The first signs of growth in the UK’s economy since 2007 appeared in 2013 when GDP rose to 1.4%; GDP is forecast to rise still further to 2.4% in 2014.

However the UK market was estimated at €679.6 million, a decline of 2% in 2013, in value terms. The picture was mirrored in Europe where the total air-conditioning market declined by 1%. However, southern Europe has generally been much harder hit by the financial crises.

The UK air-conditioning market is largely commercial, so sales of fixed air conditioning are directly linked to the fortunes of the commercial construction market.

Building Regulations Part L, F Gas, R22 replacement (to a lesser extent), ErP directive and ventilation regulations Part F, all continue to play a part in driving trends in air-conditioning markets.

Regional air conditoning market, volume, 2012-2017

The portable market still has a relatively strong market for residential air conditioning, though the mainly cooler summers of late have dampened sales of this product considerably.

Window units are following the downward trend, as in many European countries, and are likely to disappear from the UK market. The applications are almost entirely in replacement.

Sales for split systems totalled over 160 000 units in 2013, of which 10% were VRF systems by volume but half the total market value. All units are inverter driven; although most are still based on R410A a move toward so R32 is likely in the near future

Indoor packaged units are a declining market — selling 1450 units in 2013, mostly in the form of small consoles; due to competition from splits. Main suppliers are Italian and Chinese OEM brands, although the larger units come from Lennox and Hitesca among others.

Rooftops are a popular choice in the retail and leisure sectors selling 900 units in 2013. Most units are imported in a market led by Lennox and Trane, with Weatherite as the only UK-based manufacturer.

The UK chiller market is witnessing a continuous battle between magnetic-bearing centrifugal (Turbocor), screw and scroll for the limited amount of projects around. Turbocor compressors bounced back in 2013 following the first drop in market size in 2012, though not quite reaching the market size of 200 units last seen in 2011.

Building Regulations have been the main driver for sales and technology developments in recent years.

The AHU market was the winner of all product types with 11% growth recorded in 2013, by value. The sales are being driven by Building Regulations requiring the need for fresh air ventilation.

The latest indications point to a decline in volume in 2013 over 2012 for the fan-coil market, led by. Ability Projects. However, the outlook for 2014 is a recovery.

The ErP Directive has driven changes in fan-coil design for all players. All fan coils need to have EC (electronically commutated) fan motors by 2015.

Saziye Dickson, project manager for BSRIA’s world air-conditioning study.

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