Australia and New Zealand HVAC Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2024 - 2030)

Australia and New Zealand HVAC Market Analysis

The Australia and New Zealand HVAC market was valued at 3,055.8 million in 2023, which is expected to grow at a CAGR of 6.0% during the forecast period (2024–2030). The growing demand for HVAC systems in residential applications and the rising construction industry in the region are some of the major factors boosting the market growth. Additionally, the market is further exhibiting healthy growth on account of the growing population, the rising industrial production, and the growing real estate industry.

Government regulations and standards are supporting the growth and development of the market. The focus of the Australian government on the reduction of gas emissions by 26–28% by 2030 is one of the major factors contributing to the growth in demand for HVAC systems. It includes net zero energy building (NZEB), which consumes as much energy as can be produced onsite through renewable resources. The design of NZEBs would boost the demand for energy-efficient HVAC systems.

Due to the presence of high solar radiation and increasing electricity consumption in New Zealand, the country is focusing on the extensive utilization of renewable sources of energy. In New Zealand, Auckland receives the maximum solar energy of about 2,050 hours of sunshine, and 75,000 kWh of potential solar energy each year. Therefore, the country is using solar energy in schools and houses.

The solar-powered HVAC system is an effective and efficient way for heating and cooling solutions in a building. Solar modules are directly connected to rooftop units, and the electricity generated can power the units, thereby providing energy to appliances in a building. It would result in reducing energy costs and also support inefficient cooling and heating.

Hence, with the implementation of various solar energy-driven systems in the country, the demand for solar-powered HVAC systems is expected to create opportunities for players operating in the Australian and New Zealand HVAC market during the forecast period.

Australia and New Zealand HVAC Market Trends & Drivers

Green Buildings Are First Priority

• The preference toward green/smart buildings is gaining importance, owing to factors such as high carbon emissions, increasing pollution levels, and the urge to create a healthy and sustainable environment.
• A green building consists of practices, including energy efficiency, water conservation, greenhouse gas emission reduction, waste reuse, and recycling, which reduce natural resource consumption and protect the environment.
• Real estate companies are focusing on the construction of green/smart buildings due to their increasing demand.

Increasing Number of Residential and Commercial Projects

• The rising number of residential and commercial projects is a major factor propelling the growth of the ANZ HVAC market. This is attributed to the growing population and the rising construction industry in ANZ.
• Further, the increasing number of residential and commercial projects requires a large number of HVAC systems and is also supporting the growth of the HVAC market.
• For instance, the West Edge-New Lynn, a residential project in Auckland, New Zealand, comprises the construction of 2,088 homes. The project costs around $3 billion and is scheduled to be completed by 2027.

High Upfront Cost

• The high upfront cost is a key factor hindering the market growth. For the deployment of multiple HVAC systems in a building, complexities associated with the installation process are high.
• The pipework and specific installation requirements of ducted systems vary based on manufacturers, which makes initial installation a complex, tedious, and costly job.
• Furthermore, the life expectancy of an HVAC system depends on its proper installation, which is the most complex step of the whole process of installation.
• The , especially VRF systems, require regular inspection and maintenance by trained personnel, due to their complicated design.
• Moreover, for the superior control of the systems, piping and control systems must be installed as per manufacturers’ specific instructions.
• Pressure testing, changing of filters, and cleaning of fan coils are very critical for the maintenance of HVAC systems.
• Thus, high maintenance cost due to the complicated design of the HVAC systems leads to high upfront costs, which may restrict the market growth.

In-Depth Segmentation Analysis

Type Analysis

• Cooling is the largest category, with a revenue share of more than 60% in 2023, as well as it is the fastest-growing category in the market.
• These countries’ sub-tropical climate in most of their areas is the primary factor behind the dominance of the cooling category.
• Along with this, environmental factors such as global warming and rising pollution are contributing to the demand for energy-efficient cooling equipment.
• Some of the other factors that boost the growth of the market in this category include improving economic conditions and rising per capita income in these countries.
• As cooling or air conditioning is increasingly becoming a necessity, air conditioner (AC) manufacturing companies are continuously working on providing cheaper and more efficient systems, which, in turn, is providing steady growth to the market.

Further, the types are categorized into:

• Heating
• Heat pumps
• Boilers
• Furnaces
• Unitary heaters
• Ventilation
• Ventilation fans
• Air handling units and fan coil units
• Humidifiers/dehumidifiers
• Air cleaners
• Cooling (Largest and Fastest-Growing Type)
• Ducted split/packaged units
• Split units
• Room ACs (largest cooling type)
• Chillers
• Variable refrigerant flow units (fastest-growing cooling type)

End User Analysis

• The commercial is the largest category, with a market share of around 40% in 2023, in the market.
• This supremacy is due to rapid urbanization and economic growth, which have led to an increase in the construction of malls, hospitals, commercial buildings, special economic zones (SEZs), and hotels, thereby contributing to the increasing demand for HVAC systems.
• Since HVAC systems are an integral part of buildings, the market for these systems in the commercial sector is further expected to boost.
• The industrial category is rapidly growing in the market, advancing at a CAGR of around 6.3% from 2024 to 2030.
• This growth can be because food and beverage manufacturers are enjoying a strong reputation in the export market, with meat, grain, horticulture, and seafood being the most sought-after products.
• Keeping processing rooms properly cooled and clean is the fundamental requirement for food production.
• Low temperature reduces the growth of bacteria, so properly maintaining and controlling the environment is a base requirement to preserve food items. For this, advanced HVAC systems are required in cold storage rooms, which will contribute to the high growth of this category.

During the study, end users are divided into:

• Commercial (Largest End-User Category)
• Office and buildings
• Supermarkets/hypermarkets
• Government
• Healthcare
• Hospitality (largest and fastest-growing commercial category)
• Transportation
• Others
• Industrial (Fastest-Growing End-User Category)
• Oil and gas
• Energy and utilities
• Food and beverages (largest industrial category)
• Automotive (fastest-growing industrial category)
• Others
• Residential

Competitive Analysis

The Australian and New Zealand HVAC market is competitive in nature, owing to the presence of established HVAC players and a rising number of regional players. The major players in the market are involved in product launches, mergers and acquisitions, and other developments.

The companies, including Samsung Electronics Co. Ltd., United Technologies Corporation, Johnson Controls International plc, Daikin Industries Ltd., and Siemens AG, are involved in product launches to cater to the growing demand for HVAC systems, thereby acquiring a greater number of customers. Ingersoll-Rand plc and Johnson Controls International plc are also involved in mergers and acquisitions, which would strengthen their product offerings and support future growth plans.

Australia and New Zealand HVAC Industry News

• In January 2024, Daikin Industries Ltd. acquired Robert Heath Heating Ltd. to become a total solution provider in the heating, ventilation, air conditioning, and refrigeration (HVAC-R) market and offer exceptional customer experiences.
• In January 2024, LG Electronics (LG) unveiled its latest heating, ventilation, and air conditioning (HVAC) solutions at AHR Expo 2024 in the U.S.
• In September 2023, Johnson Controls with Hitachi Air introduced the Hitachi air365 dual fuel system to provide efficient and economical home comfort as well as to reduce carbon emissions.
• In October 2022, Lennox Industries installed 210 HVAC units in the U.S. and Canada at no cost.