Automotive HVAC Market Size, Share & Trends Analysis Report By Technology (Manual, Automatic), By Vehicle (Passenger Cars, LCV, HCV), By Region, Vendor Landscape, And Segment Forecasts, 2018 - 2025

Report Overview

The global automotive HVAC market size was valued at USD 15.28 billion in 2017. It is expected to post a CAGR of 8.6% over the forecast period. Surging demand for passenger vehicles and soaring need for more luxurious and comfortable travel options have been propelling the market. Changing environmental conditions, increasing income levels, and growing middle-class population are estimated to boost the growth of the market over the forecast period.

An automotive HVAC unit has become an integral part of passenger vehicles offering various comfort features to consumers, thereby influencing their buying preferences. It helps maintain the internal temperature of vehicle cabins as well as offers a variety of thermal control features such as fogging sensors, automatic temperature control, and fan speed, among others.

The integration of electronics, sensors, and automated climate control features at a lesser cost is translating into greater adoption of HVAC units in passenger vehicles. Private car rental players such as Uber, Ola, Lyft, and Sidecar have made air conditioning as their basic requirement to enhance customer value proposition, which is also anticipated to drive the global market.

Technological innovations and substantial investments in R&D initiatives are poised to enhance the offering and technological capabilities of players. They are leading to the innovation of energy-efficient systems and eco-friendly HVAC units coupled with innovative designs to lower the weight and size of systems for better adaptability and improved vehicle performance. The operation of these HVAC systems requires considerable power and has a negative effect on fuel economy.

Reduction in system size and weight of the system will support the growth of the market over the coming years. Government initiatives to curb global warming are projected to lead to the introduction of energy-efficient and green technology solutions.

However, the automotive industry has been a major contributor to rising levels of CO2 emissions. Besides this, growing consumer awareness regarding deteriorating environmental conditions has been encouraging consumers to shift towards eco-friendly solutions. Increasing government regulations to develop energy-efficient and low emission solutions coupled with high maintenance costs are likely to adversely affect the growth of the market.

Vehicle Type Insights

On the basis of vehicle type, the market has been classified into heavy commercial vehicles (HCV), light commercial vehicles (LCV), and passenger vehicles. Rising disposable income and availability of various finance schemes are anticipated to spur the growth of the market over the forecast period. Passenger car HVAC accounted for approximately three-quarters of the overall revenue in 2017. It is projected to exhibit the highest CAGR during the forecast period.

Demand for automotive HVAC systems in LCVs is also poised to rise at a healthy pace due to better financial schemes and rural demand. Booming e-commerce and logistics sectors and soaring need for fleets to support last-mile connectivity are likely to foster the growth of the segment over the forecast period.

Technology Insights

Based on technology, the market has been segmented into automatic and manual systems. The size of the manual systems segment, where users must select temperature and blower settings, is poised to decline over the years owing to low efficiency and complexity. The technology is likely to represent approximately 35.0% of the overall revenue of the automotive HVAC market by 2025.

The automatic system is a major technology segment and is expected to dominate the market through 2025. The segment accounted for just over 60% of the overall market revenue in 2017. It is estimated to register a higher CAGR of over 9.7% during the forecast period. Burgeoning demand for automatic automotive HVAC systems can be attributed to evolving consumer preferences and increasing demand for luxury vehicles. Furthermore, technological advancements in HVAC technologies such as automatic air recirculation, automatic temperature controls, and fogging sensors can help enhance vehicle performance and reduce overall fuel consumption.

Regional Insights

The Asia Pacific market is likely to witness significant growth owing to the presence of key automobile manufacturers, large scale production of vehicles, and spiraling vehicle demand in developing nations such as India, South Korea, and China. Government initiatives to revive the automotive industry are expected to drive the market during the forecast period. For instance, the Government of India allowed 100.0% Foreign Direct Investment (FDI) through the automatic route in the automobile sector. The region accounted for over 47.0% of the overall revenue in 2017.

North America is estimated to experience healthy growth during the forecast period due to improving macroeconomic conditions and increasing vehicle production in the region. The region is anticipated to rise at a CAGR of over 8.0% during the forecast period. Additionally, rising disposable income in the U.S. and surging demand for luxury vehicles are projected to stimulate the growth of the regional market over the same period.

Key Companies & Market Share Insights

Key industry players include Brose Fahrzeugteile GmbH & Co. Kg, Air International Thermal Systems, Hanon Systems, Calsonic Kansei, Engineered Plastic Components, Denso Corporation, and DelStar Technologies. Other prominent vendors include Johnson Electric, Mahle Behr GmbH, Japan Climate Systems Corporation, Sensata Technologies, Sanden Holdings Corporation, and Valeo Group.

Key market players are focused on investing in R&D initiatives to develop innovative technologies and HVAC solutions that are cost and fuel-efficient. Market players are also interested in partnerships and M&A activities to enhance their product portfolios as well as acquire a larger market share.

For instance, In October 2015, Denso announced to help Toyota develop Prius, which improves thermal, sensing, and hybrid technologies for a safer, fuel-efficient, and greener environment. In July 2015, Mahle Group acquired Delphi Automotive’s thermal business to enhance its market penetration and product offering. Delphi Automotive was among the top five industry players and this acquisition is poised to give a significant competitive edge to Mahle Group over other competitors.

Automotive HVAC Market Report Scope

Segments Covered in the Report

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2015 to 2025. For the purpose of this study, Grand View Research has segmented the global automotive HVAC market report on the basis of technology, vehicle type, and region:

• Technology Outlook (Revenue, USD Million, 2015 - 2025)

  • Automatic

  • Manual

• Vehicle Type Outlook (Revenue, USD Million, 2015 - 2025)

  • Passenger Cars

  • Light Commercial Vehicle (LCV)

  • Heavy Commercial Vehicle (HCV)
    

• Regional Outlook (Revenue, USD Million, 2015 - 2025)

  • North America

    • The U.S.

    • Canada

    • Mexico

  • Europe

    • The U.K.

    • Germany

  • Asia Pacific

    • India

    • China

    • Japan

  • South America

    • Brazil

    • Argentina

  • Middle East & Africa