HVAC System Market Report 2026

The hvac system market size has grown strongly in recent years. It will grow from $189.81 billion in 2025 to $202.05 billion in 2026 at a compound annual growth rate (CAGR) of 6.5%. The growth in the historic period can be attributed to expansion of commercial construction, residential urbanization, conventional hvac installations, rising cooling demand, building comfort requirements.

The hvac system market size is expected to see strong growth in the next few years. It will grow to $260.58 billion in 2030 at a compound annual growth rate (CAGR) of 6.6%. The growth in the forecast period can be attributed to smart city initiatives, net zero building targets, energy efficiency regulations, growth of green buildings, digital building management systems. Major trends in the forecast period include increasing adoption of smart hvac systems, growth of retrofit and replacement projects, focus on indoor air quality enhancement, integration of energy recovery technologies, demand for climate adaptive buildings.

The increase in construction activities within the commercial and residential sectors is projected to drive the growth of the HVAC system market in the future. The construction sector encompasses both residential and non-residential infrastructure, which includes commercial, industrial, and other types of buildings. HVAC systems are essential mechanical systems that provide thermal comfort and maintain indoor air quality, commonly used in a variety of settings, including industrial, commercial, residential, and institutional buildings. For instance, in March 2024, Atradius, a Netherlands-based insurance company specializing in trade credit insurance, reported that global construction output is expected to rise by 2% in 2024, following a 3.7% increase in 2023. Advanced economies are projected to grow by 1.8%, while emerging markets are anticipated to see a 2.2% rise in building activity. Furthermore, non-residential output and civil engineering are expected to grow by 2.8% and 4.4%, respectively, this year. In 2025, global construction is forecasted to grow by 1.8%, with residential construction output rebounding by 2.4% due to improving economic conditions and the impact of more lenient monetary policies. Consequently, the surge in construction activities in both commercial and residential sectors is driving the expansion of the HVAC system market.

Major companies in the HVAC system market are intensifying their focus on advanced heating and cooling solutions to stay competitive. The introduction of the dual fuel system is one such innovation that optimizes energy use by utilizing two different fuel sources, such as natural gas and electricity. Johnson Controls-Hitachi Air Conditioning launched the Hitachi Air365 Hybrid dual fuel system in September 2023. This system integrates electric and gas technologies for efficient climate control in residential and commercial settings. The emphasis on advanced solutions demonstrates the commitment of HVAC industry leaders to meet evolving market demands and enhance overall system performance.

In May 2023, Daikin Applied, a prominent US-based HVAC solutions company, successfully acquired Carroll Air Systems for an undisclosed sum. This strategic acquisition is anticipated to facilitate the expansion of Daikin Applied's HVAC product offerings. Aldridge Carroll Air Systems, the acquired company, is based in the US and specializes in providing heating, ventilation, and air-conditioning (HVAC) systems and services tailored for commercial, industrial, and institutional facilities.

Major companies operating in the hvac system market are Daikin Industries Ltd., Johnson Controls International, Carrier Global Corporation, Trane Technologies PLC, LG Electronics, AAON Heating and Cooling Products, Addison HVAC, Allied Commercial, Danfoss AS, Emerson Electric Co., Honeywell International Inc., Mitsubishi Electric Corporation, Nortek Air Management, Samsung Group, Midea Group, Electrolux AB, Toshiba Corporation, York International Corporation, Nortek Global HVAC, Rheem Manufacturing Company, Goodman Manufacturing Company, Lennox International Inc., SPX Corporation, Standex International Corporation, CSW Industrials Inc., EMCOR Group Inc., Ingersoll-Rand plc (Ireland), Watts Water Technologies Inc.

Asia-Pacific was the largest region in the HVAC system market in 2025. The regions covered in the hvac system market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the hvac system market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The HVAC system market consists of sales of heat pumps, furnaces, unitary heaters, boilers, single splits, variable refrigerant flow (VRF) systems, chillers, room air conditioners, and other types. Values in this market are ‘factory gate’ values, that is, the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors, and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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