Industry News

Easy Finance, Energy Efficiency to boost AC sales

India: With increasing temperature, air-conditioner players such as LG, Samsung, Panasonic, Haier and Carrier Midea are expecting 30 per cent increase in their sales on account of easy financing options and launch of energy efficient air conditioners in the country. Moreover, high- end smart app-models and inverter ACs will increase the sales by 15 per cent. Decrease in temperature in the starting of March due to unseasonal rains in North, which accounts for 35 per cent of the total sales to the industry, but early onset of summers from the month of February will boost the demand of air-conditioners across the country.

Easy financing schemes to boost sales from rural areas, and the ratio of urban to rural AC sales is hopefully to increase to 60:40 this year. People in India are now preferring split air conditioners over window air conditioners, and the trend has been changing now, as the ratio of split ACs to Window ACs is 70:30, which was 50:50 earlier.

According to a report published by Techsci Research India Air Conditioners Market Forecast & Opportunities, 2020”, the Indian air conditioners market is projected to grow at a CAGR of over 10% during 2015-20. Accounting for a lion’s share of the air conditioners market, split air conditioners segment was the highest revenue generator, followed by VRFs and window air conditioners in 2014. The market share of window air conditioners has been declining over the last few years on account of decreasing price gap compared to split ACs, due to which many leading companies such as Samsung and LG have exited from the windows air conditioning segment while other major companies like Voltas, Daikin, Blue Star, etc., have lowered the production of window air conditioners in the country. Northern India generates the highest revenue in the country’s air conditioners market, followed by Southern and Western regions.

According to TechSci Research, the companies should target users through online channels, which can help them in increasing their sales volume, as the demand of the products from the online channels are rising, Players such as Snapdeal and Flipkart are experiencing increasing demand of the products that are offered by these websites. The AC makers try to produce more and more split air-conditioners, as consumer these days are moving towards split ACs as they are less noisy and more energy efficient, which can save energy without compromising on cooling. Inverter ACs and app-controlled unit are expected to boost sales in the future years, so, the companies can target this particular segment as well.