The Saudi Arabian residential AC market is projected to generate $917.8 million revenue by 2030, advancing at a CAGR of 6.5% during 2021–2030. The key factors driving the industry include the increasing heat and humidity in the environment, the rising disposable income and changing lifestyles, and the surging investment in the housing sector in the country.
Under Saudi Vision 2030, the country has invested heavily in the housing sector. Also, there is a separate section named housing program, which focuses on providing appropriate housing solutions, i.e., making required changes in the existing houses and building new housing units, customized as per the financial and other personal requirements of people. This program would ensure that more residential units are built, thereby increasing the demand for residential air conditioners in the country.
Moreover, the demand for fresh and clean air, due to the pandemic, has increased, and as a result, companies are now working on developing technologies and incorporating the same in their products.
The split AC category is expected to witness the fastest growth, advancing at a CAGR of around 8%, during the forecast period. This can be because split ACs are simple to install and do not need ducts, which make them affordable. Also, this air conditioner is intended to fit in a small space and requires short copper tubes and cables. In addition, due to low purchasing and installing costs and long-term cost savings, wall-mounted split air conditioning units are ideal for investment properties. Costs can be managed, and energy consumption can be reduced when the wall-mounted unit is adjusted at the proper temperature.
Based on distribution channel, the e-commerce category held the largest market share in 2021, and it is projected to progress at the highest CAGR during the forecast period. This is because products offered over the internet are generally cheaper than those from shops. Also, it provides a wide range of options to customers to go through multiple options.
Furthermore, the changing lifestyles and the increasing number of government policies aimed at revamping the country's oil-dependent economy are also projected to drive the demand for residential air conditioning systems throughout the projection period. Moreover, the rising demand for energy-efficient systems is being witnessed, owing to the initiatives taken by the government, such as the provision of monetary incentives to consumers who purchase air conditioners with a specific energy efficiency rating.
Major players operating in the Saudi Arabian residential AC market include LG Electronics Saudi Arabia LLC, Gree Electric Appliances Inc. of Zhuhai, Zamil Air Conditioners, Al Salem Johnson Controls, Samsung Electronics Saudi Arabia Ltd., FUJITSU GENERAL (MIDDLE EAST) FZE, S.K.M. Air Conditioning LLC, Daikin Air Conditioning Saudi Arabia LLC, Carrier - Saudi Arabia, and Midea Gulf.