A common misconception for the heating, ventilation and air conditioning (HVAC) equipment market is that developing countries comprise the greatest market opportunity; however, IHS recently found abundant potential in mature countries, such as Germany.
A common misconception for the heating, ventilation and air conditioning (HVAC) equipment market is that developing countries comprise the greatest market opportunity; however, IHS recently found abundant potential in mature countries, such as Germany.
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In 2014, Germany was found to be the largest market for air handling units (AHU) in Europe; however, for total HVAC equipment, the German market was estimated to be
well below the European average when considering
economic proportions.
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In its new report titled the World Market for HVAC Equipment – 2015, IHS found that there were two main factors which contribute to the uniqueness of this market.
Firstly, the climate of Germany is fairly mild during the summer months. As a result, many building owners decide to install ventilation systems with AHUs to deliver fresh air, rather than central air conditioning.
Secondly, the cost of energy heavily deters the installation of central air conditioning equipment. In 2014, according to Eurostat, the statistical office of the European Union, the cost of electricity in Germany was €29.8 cents per kilowatt-hour (cents/kWh). This price was the second highest in the region, behind Denmark, with the European average being €20.4 cents/kWh.
Despite the high cost of energy, building owners have slowly begun to show more receptiveness to central air conditioning products to increase the comfort of office spaces. Furthermore, as the efficiencies of the products and the control systems continue to improve, Germany will see an increased adoption of central-air conditioning systems. Consequently, IHS has forecast volume growth of 7.4% through 2019 for central air conditioners in new non-residential buildings.