HVAC System Market by Cooling, Ventilation - Global Forecast to 2029

 The global HVAC System Market size is expected to be valued at USD 281.7 billion in 2024 and is projected to reach USD 389.9 billion by 2029 and grow at a CAGR of 6.7% from 2024 to 2029.

The market is experiencing growth driven by an increasing demand for energy-efficient and sustainable buildings. This demand spans residential, commercial, and industrial properties, driven by the need for climate control and comfortable indoor air quality. Climate change is also intensifying the requirement for both cooling and heating systems.

Based on the cooling equipment type, VRF system to hold the highest market growth during the forecast period

Cooling systems are used to lower the temperature, enable proper air distribution, and control humidification in a space. Cooling systems are available in various forms, from portable to massive systems designed to cool the entire space. HVAC cooling equipment encompasses various systems designed to regulate indoor temperature and humidity. Variable refrigerant flow (VRF) systems fluctuate the refrigerant flow in indoor units based on the requirement. VRF systems are available as heat pump systems or heat recovery systems for applications requiring simultaneous heating and cooling. It provides wind-free cooling that powerfully and gently cools the ambient temperature of the room, primarily used in residential complexes and commercial spaces, fostering increased demand throughout the forecast period.

Based on heating equipment, Heat pumps to hold the highest market share during the forecast period

Heating equipment forms an integral part of HVAC systems. They are used to heat buildings to a particular temperature. Heat pumps accounted for the largest share of the HVAC system market in 2023. The equipment is gaining higher acceptance owing to its multiple capabilities. Many models feature cooling and space-heating capabilities, and a few can heat water. Furthermore, heat pumps have higher efficiency than many other cooling or space heating units, which is expected to increase their demand. The residential application led the market for heating equipment. The low operating cost and high operating capacity of heat pumps make them suitable and eco-friendly substitutes for conventional heating appliances in residential applications.

Based on Ventilation equipment, the air-handling unit to hold the highest market share during the forecast period

Ventilation equipment refers to mechanical devices used to maintain and improve air quality in an indoor environment by increasing the circulation and exchange of fresh air. Proper ventilation is important for maintaining a healthy indoor environment. Air-handling units held the largest size of the HVAC system market for ventilation equipment in 2023. The AHU reconditions and circulates the air as a part of a heating, ventilating, and air conditioning system. It is a portable and simple system requiring minimum air regulation space. The rising use of air-handling units in commercial buildings, hospitals, and universities is expected to fuel the growth of the market.

Based on Implementation type, the new construction building to hold the highest market share during the forecast period

HVAC system is installed in a building during construction. They can also be retrofitted. Retrofitting can be done to upgrade the existing HVAC systems making them more energy-efficient and providing additional functionality. Thus, implementing HVAC controls can be classified into new construction buildings and retrofit buildings. The new construction buildings segment will lead the global HVAC system market during the forecast period. The governments of various countries are making high investments in infrastructure development, such as expansion projects of hotels, retail stores, airports, and educational buildings. For example, the Energy Star program by the US government provides resources and recognition to organizations that implement energy-efficient practices, including installing energy-efficient HVAC systems.

Based on Service type, the Installation services to hold the highest market share during the forecast period

The HVAC industry offers a variety of services to ensure comfortable and healthy indoor environments in residential and commercial buildings. These services include installation, maintenance, and repair of heating, ventilation, and air conditioning systems. The installation services segment is expected to lead the global HVAC system market during the forecast period. As more buildings require efficient heating and cooling solutions, the need for professional installation services grows, driving market share. Additionally, complex regulations and the necessity for specialized expertise further solidify the demand for installation services, positioning them for substantial growth in the future.

Based on Application type, the Commercial segment to hold the highest market share during the forecast period

The HVAC system market based on application has been segmented into commercial, residential, and industrial. The commercial application has been divided into healthcare, education, government, office, airport, and retail. The commercial application segment is expected to hold the largest market share during the forecast period. The growth is attributed to the increasing adoption of HVAC systems in commercial buildings, growing demand for energy-efficient devices, and rising awareness regarding energy conservation in developing regions such as Asia Pacific and RoW. Moreover, increasing investments by governments in the construction of commercial spaces are also expected to propel the growth of the market for commercial applications.

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HVAC System Market in Asia Pacific to hold the highest market share during the forecast period

The HVAC system market has been segmented into four regions: North America, Europe, Asia Pacific, and the Rest of the World (RoW). The market in China and India are expected to grow highly. This can be attributed to the expansion of the construction sector and the rising number of data centers in these countries. The Asia Pacific region is expected to lead the market, expanding at the highest CAGR during the forecast period. Increasing construction activities, rising population, per capita income, growing need for energy-efficient devices, and favorable energy efficiency incentives by the government are key factors driving the growth of the market in the region. Countries such as China, Japan, and India are propelling the development of the HVAC system market in the Asia Pacific. China held the largest size of the market in Asia Pacific in 2023. Rapid industrialization and urbanization have created the need for energy saving.