Automotive Air Conditioning Market

Automotive Air Conditioning Market

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akash

Author:

Akash Vedpathak

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Fact-checked by:

Amulya Agarwal

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Editor:

Shreyas Tandon

Automotive Air Conditioning Market Outlook 2031

The global automotive air conditioning market size was valued at USD 21.6 Billion in 2022 and is estimated to reach USD 37.43 Billion by 2031, expanding at a CAGR of 6.3% during the forecast period, 2023-2031. Rising need for comfortable and luxurious travel is anticipated to drive the market in the coming years.

An automotive air conditioning unit has become an essential part of passenger vehicles, as it offers different comfort features that directly influence the customers’ choices. These units provide automatic temperature control feature, fogging sensor, and controls the fan speed. Major players in the market are manufacturing advanced air conditioning systems that are efficient and environment-friendly. 

Automotive Air Conditioning Market Outlook

Technological advancement in air conditioning systems is expected to decrease the compressor’s power consumption, resulting in fuel savings. Cutting-edge cooling systems enhance customer experience, improve product sustainability, and lower operating costs. Additionally, improved vehicle cooling systems aid in air filtration which in turn reduces airborne infections.

The research report finds that the COVID-19 pandemic boosted the automotive air conditioning market, due to the rising demand for passenger vehicles and efforts to increase interior comfort. Rapid industrialization has led to increased air pollution levels in several countries; thus, manufacturers are using green technologies to develop energy-efficient and eco-friendly AC systems. For instance,

  • In November 2021, a leading automotive supplier company, Marelli Corporation introduced an Indoor Air Quality (IAQ) Purification System. This system uses UV-C and UV-A light with titanium dioxide (TiO2) to kill viruses and bacteria, even the COVID-19 virus, with over 99% effectiveness in 15 minutes.

This development increased the product demand during the pandemic to ensure a safe and healthy environment and is expected to boost the market in the coming years.

Artificial Intelligence Impact on Automotive Air Conditioning Market

The development of automotive AC systems with the integration of Artificial Intelligence (AI) is projected to fuel the market. With the help of AI, several operations can be controlled automatically depending on the occupancy of space.

An AI-based air conditioner uses sensors to offer purified airflow and manage humidity levels and comfortable temperatures. 
It assists in understanding the uncertainties of climate change, leading to improved observation programs.

It prioritizes heating or cooling specific zones during peak hours to optimize comfort and conserve energy. Furthermore, AI uses sensors that aid in delivering clear airflow to the indoor environment, which is likely to support market expansion.  

Automotive Air Conditioning Market Dynamics

Major Drivers

Rising use of Air conditioners as a basic feature in cars is expected to drive the market. Private car rental players intend to make air conditioning, a basic feature in their cars to improve customer satisfaction, which has surged the demand for AC. Swift changes in lifestyles, a growing population, and government initiatives to introduce energy-efficient and green technology solutions are likely to fuel the market.

Existing Restraints

Rising concerns about global warming are projected to hinder the growth of the market during the forecast period. Several countries are implementing measures to reduce their carbon footprint, which is likely to decrease the demand for air conditioners. Moreover, the growing awareness among consumers regarding the decline in environmental conditions due to increasing CO2 emissions boosts product development.  

Emerging Opportunities

Innovations such as energy-efficient and eco-friendly air-conditioners are expected to create lucrative opportunities for the market players. The marginal cost of sensors and integration of automated climate control features in the AC units are expected to drive the market during the forecast period.

Manufacturers are encouraged to design units that use minimum energy and have lower weight with compact structures to improve the performance of vehicles. For instance,

  • In August 2021, Valeo introduced a heat pump that can draw two-thirds of its energy from ambient air which in turn reduces the need for drawing energy from onboard batteries. Furthermore, vehicles equipped with it can travel up to 30% further at -15°C compared to those with traditional heating systems as it uses natural refrigerant.

Scope of Automotive Air Conditioning Market Report

The market report includes an assessment of the market trends, segments, and regional markets. Overview and dynamics have also been included in the report.

Attributes

Details

Report Title

Automotive Air Conditioning Market - Global Industry Analysis, Growth, Share, Size, Trends, and Forecast

Base Year

2022

Historic Data

2016–2021

Forecast Period

2023–2031

Segmentation

Technology (Manual and Automatic), Component (Evaporator, Receiver, Condenser, and Compressor), Vehicle Type (Passenger Cars, Light Commercial Vehicles, and Heavy Commercial Vehicles), and Distribution Channel (Aftermarket and Original Equipment Manufacturers)

Regional Scope

Asia Pacific, North America, Latin America, Europe, and Middle East & Africa

Report Coverage

Company Share, Market Analysis and Size, Competitive Landscape, Growth Factors, Market Trends, and Revenue Forecast

Key Players Covered in the Report

Brose Fahrzeugteile GmbH & Co. Kg; Air International Thermal Systems; Hanon Systems; Calsonic Kansei; DelStar Technologies; Denso Corporation; and Engineered Plastic Components. Other leading vendors include Japan Climate Systems Corporation; Sensata Technologies; Sanden Holdings Corporation; and Valeo Group

Air Conditioning Market Segment Insights

Technology Segment Analysis

In terms of technology, the market is bifurcated into manual and automatic. The manual segment is expected to grow rapidly during the forecast period, as manual air-conditioner is more cost-friendly than automatic one. It offers the flexibility to set the temperature according to passengers' expectations, the temperature setting remains as it is until passengers change it.

The automatic segment is projected to exhibit a significant CAGR, owing to its advantages over manual systems. As per automobile experts, it helps to maintain the fuel efficiency of the car. Furthermore, evolving consumer preferences and increasing demand for luxury vehicles are some of the key factors driving the growth of the automatic AC system segment.

Automotive Air Conditioning Market Technology

Component Segment Analysis

On the basis of component, the market is segregated into evaporators, receivers, condensers, and compressors. The evaporators segment is expected to expand at a substantial CAGR during the forecast period.

The increasing urban population and temperature boost the demand for automotive air-conditioned, which ultimately spurs demand for the evaporator. 
The compressors segment is anticipated to account for a major market share during the forecast period.

The rising need for cooling solutions in a wide range of applications including residential, transportation, food & beverages, and healthcare is expected to increase the demand for air conditioner compressors during the forecast period. Major players focused on improving compressors which in turn propelled the segment. For instance,  

  • In February 2021, Highly Marelli Holdings Co., Ltd. formed a joint venture between Highly International (Hong Kong) Limited and Marelli Corporation K.K. Their focus is on providing first-class solutions for clients and suppliers in the areas of compressor electrification, heat pump systems, heating, ventilation, air conditioning ("HVAC"), and electric-driven compressor ("EDC") systems.

Vehicle Type Segment Analysis

Based on vehicle type, the market has been segmented into passenger cars, light commercial vehicles (LCVs), and heavy commercial vehicles (HCVs). The passenger car segment is expected to grow at a significant rate in the forecast period.  The growth of the segment is attributed to the availability of various financial schemes and rising disposal income.

Furthermore, the demand for automotive AC systems in Light Commercial Vehicles (LCVs) is expected to rise at a healthy pace, owing to increasing demand from rural & urban areas. 
The heavy commercial vehicles segment is projected to hold a substantial market share in the coming years.

The need for comfort in harsh operating conditions has increased the demand for air conditioning in off-highway applications. However, the space constraint is a major challenge for off-highway vehicles. Thus, original equipment manufacturers are developing smaller and more efficient air conditioning systems to fit these vehicles. 

Distribution Channel Segment Analysis

On the basis of distribution channel, the market is bifurcated into aftermarket and original equipment manufacturers. The aftermarket segment is anticipated to account for a major market share during the forecast period, owing to the increasing digitalization of automotive repair and maintenance services.

The segment growth is expected to propel by the growing production of passenger automobiles in the coming years. 
The original equipment manufacturers segment is projected to expand at a considerable CAGR during the forecast period.

Strict regulations regarding emissions and fuel efficiency boost the demand for smaller and more fuel-efficient engines without impairing efficiency which is expected to fuel the segment growth.

Regional Outlook

In terms of regions, the market is classified as Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. The market in Asia Pacific is expected to witness impressive growth due to the presence of major automobile manufacturers and the large-scale production of vehicles in this region.

Emerging economies such as India, South Korea, Japan, and China are witnessing an escalating vehicle demand owing to the various initiatives taken by the state government bodies to revive the automotive industry in these countries. The availability of low-cost labor in emerging countries has boosted manufacturing. In addition, the rising vehicle sale is expected to drive the automobile air conditioning market.

The market in North America is anticipated to expand at a CAGR of 8% during the forecast period. This is due to the rising investment in R&D activities. Furthermore, the US automotive air conditioning market account for a major market share during the forecast period, due to the stringent government standards and local environmental rules.

Automotive Air Conditioning Market Region

Segments

The global automotive air conditioning market has been segmented on the basis of

Technology

  • Manual
  • Automatic

Component

  • Evaporator
  • Receiver
  • Condenser
  • Compressor

Vehicle Type

  • Passenger cars
  • Light Commercial Vehicles (LCVs)
  • Heavy Commercial Vehicles (HCVs)

Distribution Channel

  • Aftermarket
  • Original Equipment Manufacturer

Region

  • Asia Pacific
  • North America
  • Latin America
  • Europe
  • Middle East & Africa

Key Player

  • Brose Fahrzeugteile GmbH & Co. Kg
  • Air International Thermal Systems
  • Hanon Systems
  • Calsonic Kansei
  • DelStar Technologies
  • Denso Corporation
  • Engineered Plastic Components

Competitive Landscape

Major players competing in the global automotive air conditioning market are Brose Fahrzeugteile GmbH & Co. Kg, Air International Thermal Systems, Hanon Systems, Calsonic Kansei, DelStar Technologies, Denso Corporation, and Engineered Plastic Components. Other leading vendors include Japan Climate Systems Corporation, Sensata Technologies, Sanden Holdings Corporation, and Valeo Group.

Key market players are investing in R&D initiatives to develop innovative air conditioning systems that are cost-effective and environment-friendly. They are also engaging in building partnerships to increase their product portfolio and acquire a major market share.

  • In November 2021, Hanon System opened two new facilities in Hungary – a building extension in Rétság and a greenfield production site in Pécs. These facilities offer 22,464 square meters of manufacturing space and house equipment for automotive A/C lines such as brazing, forming, welding, bending, assembly lines, and testing.

Automotive Air Conditioning Market Key Players

1. Executive Summary
2. Assumptions and Acronyms Used
3. Research Methodology
4. Automotive Air Conditioning Market Overview
  4.1. Introduction
     4.1.1. Market Taxonomy
     4.1.2. Market Definition
  4.2. Macro-Economic Factors
     4.2.1. Industry Outlook
  4.3. Automotive Air Conditioning Market Dynamics
     4.3.1. Market Drivers
     4.3.2. Market Restraints
     4.3.3. Opportunity
     4.3.4. Market Trends
  4.4. Automotive Air Conditioning Market - Supply Chain
  4.5. Global Automotive Air Conditioning Market Forecast
     4.5.1. Automotive Air Conditioning Market Size (US$ Mn) and Y-o-Y Growth
     4.5.2. Automotive Air Conditioning Market Size (000’ Units) and Y-o-Y Growth
     4.5.3. Automotive Air Conditioning Market Absolute $ Opportunity
5. Global Automotive Air Conditioning Market Analysis and Forecast by Region
  5.1. Market Trends
  5.2. Introduction
     5.2.1. Basis Point Share (BPS) Analysis by Region
     5.2.2. Y-o-Y Growth Projections by Region
  5.3. Automotive Air Conditioning Market Size and Volume Forecast by Region
     5.3.1. North America
     5.3.2. Latin America
     5.3.3. Europe
     5.3.4. Asia Pacific
     5.3.5. Middle East and Africa (MEA)
  5.4. Absolute $ Opportunity Assessment by Region
  5.5. Market Attractiveness/Growth Potential Analysis by Region
  5.6. Global Automotive Air Conditioning Demand Share Forecast, 2019-2026
6. North America Automotive Air Conditioning Market Analysis and Forecast
  6.1. Introduction
     6.1.1. Basis Point Share (BPS) Analysis by Country
     6.1.2. Y-o-Y Growth Projections by Country
  6.2. North America Automotive Air Conditioning Market Size and Volume Forecast by Country
     6.2.1. U.S.
     6.2.2. Canada
  6.3. Absolute $ Opportunity Assessment by Country
  6.4. Market Attractiveness/Growth Potential Analysis
     6.4.1. By Country
     6.4.2. By Product Type
     6.4.3. By Application
  6.5. North America Automotive Air Conditioning Demand Share Forecast, 2019-2026
7. Latin America Automotive Air Conditioning Market Analysis and Forecast
  7.1. Introduction
     7.1.1. Basis Point Share (BPS) Analysis by Country
     7.1.2. Y-o-Y Growth Projections by Country
     7.1.3. Latin America Average Pricing Analysis
  7.2. Latin America Automotive Air Conditioning Market Size and Volume Forecast by Country
      7.2.1. Brazil
      7.2.2. Mexico
      7.2.3. Rest of Latin America
   7.3. Absolute $ Opportunity Assessment by Country
  7.4. Market Attractiveness/Growth Potential Analysis
     7.4.1. By Country
     7.4.2. By Product Type
     7.4.3. By Application
  7.5. Latin America Automotive Air Conditioning Demand Share Forecast, 2019-2026
8. Europe Automotive Air Conditioning Market Analysis and Forecast
  8.1. Introduction
     8.1.1. Basis Point Share (BPS) Analysis by Country
     8.1.2. Y-o-Y Growth Projections by Country
     8.1.3. Europe Average Pricing Analysis
  8.2. Europe Automotive Air Conditioning Market Size and Volume Forecast by Country
     8.2.1. Germany
     8.2.2. France
     8.2.3. Italy
     8.2.4. U.K.
     8.2.5. Spain
     8.2.6. Russia
     8.2.7. Rest of Europe
  8.3. Absolute $ Opportunity Assessment by Country
  8.4. Market Attractiveness/Growth Potential Analysis
     8.4.1. By Country
     8.4.2. By Product Type
     8.4.3. By Application
  8.5. Europe Automotive Air Conditioning Demand Share Forecast, 2019-2026
9. Asia Pacific Automotive Air Conditioning Market Analysis and Forecast
  9.1. Introduction
     9.1.1. Basis Point Share (BPS) Analysis by Country
     9.1.2. Y-o-Y Growth Projections by Country
     9.1.3. Asia Pacific Average Pricing Analysis
  9.2. Asia Pacific Automotive Air Conditioning Market Size and Volume Forecast by Country
     9.2.1. China
     9.2.2. Japan
     9.2.3. South Korea
     9.2.4. India
     9.2.5. Australia
     9.2.6. Rest of Asia Pacific (APAC)
  9.3. Absolute $ Opportunity Assessment by Country
  9.4. Market Attractiveness/Growth Potential Analysis
     9.4.1. By Country
     9.4.2. By Product Type
     9.4.3. By Application
  9.5. Asia Pacific Automotive Air Conditioning Demand Share Forecast, 2019-2026
10. Middle East & Africa Automotive Air Conditioning Market Analysis and Forecast
  10.1. Introduction
     10.1.1. Basis Point Share (BPS) Analysis by Country
     10.1.2. Y-o-Y Growth Projections by Country
     10.1.3. Middle East & Africa Average Pricing Analysis
  10.2. Middle East & Africa Automotive Air Conditioning Market Size and Volume Forecast by Country
     10.2.1. Saudi Arabia
     10.2.2. South Africa
     10.2.3. UAE
     10.2.4. Rest of Middle East & Africa (MEA)
  10.3. Absolute $ Opportunity Assessment by Country
  10.4. Market Attractiveness/Growth Potential Analysis
     10.4.1. By Country
     10.4.2. By Product Type
     10.4.3. By Application
  10.5. Middle East & Africa Automotive Air Conditioning Demand Share Forecast, 2019-2026
11. Competition Landscape
  11.1. Global Automotive Air Conditioning Market: Market Share Analysis
  11.2. Automotive Air Conditioning Distributors and Customers
  11.3. Automotive Air Conditioning Market: Competitive Dashboard
  11.4. Company Profiles (Details: Overview, Financials, Developments, Strategy)

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FAQ Section

Some frequently asked quetions about this report!

The global automotive air conditioning market size was valued at around USD 21.6 Billion in 2022.

The global automotive air conditioning market size is estimated to reach USD 37.43 Billion by 2031.

The global automotive air conditioning market size is expanding at a CAGR of 6.3% during the forecast period, 2023-2031.