The increasing infrastructure spending, rising construction activities, and growing hospitality industry are driving the growth of the heating, ventilation, and air conditioning (HVAC) market of Saudi Arabia. Moreover, the increasing disposable income and improving lifestyle of consumers is expected to boost the industry growth. As a result, the Saudi Arabian HVAC market is expected to generate revenue of $4,821.8 million in 2030, advancing at a CAGR of 8.1% during the forecast period (2021–2030).
Following The announcement of a countrywide lockdown in Saudi Arabia in the wake of COVID-19, various restrictions were imposed on pilgrims during the holy month of Ramadan. Moreover, shopping complexes, mosques, hotels, recreational centers, and theaters were shut down in order to curtail the spread of the virus. This, in turn, led to a negative impact on the HVAC industry in Saudi Arabia owing to a drop in the demand for the equipment and associated services in such facilities.
The Saudi Arabian HVAC market is classified into equipment and service, based on offering, of which the equipment category held the larger market share in 2020. This is attributed to the high demand for air conditioning systems in the kingdom because of the extreme climatic conditions. Moreover, the technological advancements in HVAC systems, such as antimicrobial-coated HVAC, movement-activated air conditioning, thermally driven HVAC, on-demand hot water re-circulators, and ice-powered HVAC, have led to the category's dominance.
Industrial, commercial, and residential are the categories under the end-user segment of the market. Among these, the industrial category is expected to be the fastest growing during the forecast period. Under Saudi Vision 2030, the government is diversifying its economy, which is why the industrial sector is receiving heavy investments. For this, industrial cities and factories are being developed and utilities provided, which is resulting in the increasing demand for HVAC systems and services.
Furthermore, Western Saudi Arabia held the largest revenue share in the HVAC market in 2020. This was because of the major infrastructure development projects in the region and religious influence of the cities of Makkah and Madinah. As these cities receive thousands of pilgrims each year, their hospitality sector is continuously growing, which is leading to the rising demand for HVAC systems and the associated services in the western region.
The Saudi Arabian HVAC market is fragmented in nature, with several global and local manufacturers operating in the country, which has led to stiff competition among them. As a result, the companies are launching new products to move ahead of their competitors.
For instance, in November 2020, Johnson Controls International plc launched a new tailored service for remote building management across the Middle East & Africa (MEA). The service involves the usage of artificial intelligence and remote monitoring for the management of HVAC operations and energy consumption.
Similarly, in January, 2019, Daikin Industries Ltd. launched a new R-32 Altherma hydronic hybrid heat pump, DEU19-006. It reduces the emissions of CO2, which is why it is cleaner than standard gas condensing boilers.
Key players in the industry are Johnson Controls International plc, Daikin Industries Ltd., LG Electronics Inc., Mitsubishi Electric Corporation, Gree Electric Appliances Inc. of Zhuhai, Danfoss A/S, S.K.M Air Conditioning LLC, Qingdao Haier Co. Ltd., GAMI Air Conditioners Manufacturing, Ingersoll-Rand Plc, Carrier Global Corporation, Panasonic Corporation, Samsung Electronics Co. Ltd., Fujitsu General Limited, Zamil Air Conditioners, Petra Engineering Industries Co., and Blue Star Limited.