HVACR Equipment Manufacturers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 1,400 HVAC and refrigeration (HVACR) equipment manufacturers in the US produce and sell heating, ventilation and air conditioning systems for residential and nonresidential buildings, as well as commercial and industrial refrigeration and freezer equipment. Firms may also sell commercial and industrial fans and blowers and air purification equipment.
Dependence on Construction Activity
Demand for HVAC and refrigeration equipment is driven by new residential and commercial construction activity.
Energy Efficiency Regulations
HVACR equipment manufacturers are forced to keep up with evolving regulations to promote energy efficiency.
Industry size & Structure
The average HVAC and refrigeration equipment manufacturer operates a single plant, has 100 employees, and generates about $35 million in annual revenue.
- The HVAC and refrigeration equipment manufacturing industry consists of about 1,400 companies, employs 143,700 workers and generates $49 billion annually.
- The industry is somewhat concentrated, as the 20 largest companies represent 53% of industry revenue.
- Large companies include Carrier Corporation, Goodman (part of Daikin Group of Japan), Trane (part of Ingersoll-Rand), Johnson Controls, Lennox International, and Rheem.
Industry Forecast
HVACR Equipment Manufacturers Industry Growth
Recent Developments
Mar 19, 2024 - HVAC Shipments Mixed
- US shipment volume of central air conditioners decreased 21.3% year over year in January 2024, according to the Air-Conditioning, Heating, and Refrigeration Institute (AHRI). Shipments of air-source heat pumps fell 17.9% in January compared to a year earlier. Shipments of residential gas storage water heaters declined by 3.3% in January, and residential electric storage water heater shipments were up 2.4%. January shipments of commercial gas storage water heaters increased 0.1% year- over-year, and commercial electric storage water heater shipments rose 9.4%. Gas warm air furnace shipments dropped 15.7% in January from a year earlier, and shipments of oil warm air furnaces grew by 1.6%.
- Total nonresidential building construction spending is projected to rise 8% in 2024 over 2023, according to FMI’s first-quarter 2024 North American Engineering and Construction Outlook. At growth of 18%, manufacturing will lead 2024 nonresidential building construction, followed by lodging (+12%), educational (+10%), and healthcare (+8%). Some other segments of the nonresidential building sector face headwinds, including high interest rates, inflation, and tighter lending standards. These pressures and high vacancy rates will reduce office project spending by 2% in 2024. Commercial project spending is forecast to decline by 4% in 2024. High interest rates will also challenge the housing market. Single-family construction spending is forecast to drop 5% in 2024 after falling 14% in 2023. Spending for multifamily is expected to decline 15% in 2024 after projects in development peaked at 1 million units in mid-2023. Home improvement project spending will drop 4% in 2024 from 3% growth in 2023.
- The Dodge Momentum Index (DMI) decreased by 1.4% in February 2024 to 180.5 (2000=100), down from the revised January reading of 180.5. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which has been shown to lead construction spending for nonresidential buildings by a full year. On a monthly basis, the commercial planning component dropped by 2.3%, and institutional rose by 0.1%. Dodge’s associate director of forecasting, Sarah Martin, said, “Weaker office and healthcare planning constrained nonresidential planning in February. However, the Index remains 25% higher than where it was just two years ago. Most other categories showed growth over the month and Dodge remains optimistic that nonresidential planning will stay elevated throughout 2024 alongside rising confidence in 2025 market conditions.”
- Home builder confidence improved in March amid a lack of existing homes on the market and moderating mortgage rates that remained below 7%, according to the National Association of Home Builders (NAHB). Home builder sentiment, as measured by the NAHB/Wells Fargo Housing Market Index (HMI), rose three points to 51 in March 2024, which marked the highest HMI reading since July 2023 and the fourth consecutive month of strengthening confidence. Any HMI reading over 50 indicates that more builders see conditions as good than poor. The NAHB said that while lower interest rates have improved affordability and drawn more buyers back to the market, 2024 could bring supply-side headwinds, including shortages of workers, materials, and available lots.
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