The global variable refrigerant flow (VRF) systems market is expected to reach $24.1 billion by 2023, registering a CAGR of 13.4% during the forecast period (2018–2023). The market is majorly driven by increasing demand for energy-efficient and cost-effective heating, ventilation, and air conditioning (HVAC) systems, globally.
Insights into market segments
On the basis of component, the VRF systems market is categorized into outdoor units, indoor units, and control systems and accessories. Among these, the control systems and accessories category is projected to witness the fastest growth during the forecast period, owing to the increasing need for smart control systems backed by connected devices and internet of things (IoT), around the globe.
Based on compressor unit, the VRF systems market is bifurcated into air-cooled and water-cooled. Of these two categories, the market for water-cooled VRF systems is expected to record significant growth during the forecast period, owing to their increasing demand from commercial and residential application areas in Asia-Pacific (APAC) and Europe.
On the basis of system type, the VRF systems market is categorized into heat pump systems and heat recovery systems. Of these, heat pump systems are larger category in 2017. This is attributed on account of their ability to deliver maximum occupant comfort, optimum energy efficiency, low operational noise, and low maintenance cost. Whereas, the market for heat recovery systems is expected to register faster growth during the forecast period, due to their higher efficiency.
Based on application area, the VRF systems market is classified into commercial, residential, and others; wherein, others include metro stations, railway stations, and airports. Among these, the commercial category contributed the largest revenue to the market. This is attributed to the surging construction activities and strict building regulations pertaining to energy efficiency and compliance levels, which act as key factors driving the demand for VRF systems in commercial applications. Besides, financial incentives offered by governments of various countries for the installation of VRF systems in new construction projects are expected to provide an impetus to the sales of these systems for commercial applications.
North American market would register significant growth over the forecast period
Geographically, the North American VRF systems market is projected to witness the highest CAGR during the forecast period. This can be attributed to the rising preference for VRF commercial air conditioning systems, along with the stringent regulations by the U.S. government related to energy efficiency. Besides, advantages such as total life-cycle cost, energy efficiency, and flexibility in terms of design associated with VRF systems, along with the changing climate conditions in countries like U.S., will also drive the demand for these systems.
Increasing development of VRF systems for cold regions is a key trend observed in market
Irrespective of the type, specific designs of VRF systems are increasingly being made for cold regions around the world. As these regions experience very dry and cold, snowy, and humid temperature, players in the VRF systems market are developing products for each specific condition, which is a growing trend in the market. Also, significant growth of the market in the cold regions is observed, owing to the ability of these systems for heating effectively at temperature as low as minus 22 °F.
VRF Systems Market Competitive Landscape
The global VRF systems market is highly competitive in nature, with the presence of numerous players. In 2017, Daikin Industries Ltd. held the top position in the market and is focusing on expanding the sales of VRF systems to reinforce its market leadership, globally. Some of the key players operating in the market are Emerson Electric Co., United Technologies Corporation, Daikin Industries Ltd., Johnson Controls International Plc, Schneider Electric SE, Toshiba Corporation, LG Electronics Inc., Fujitsu Ltd., Mitsubishi Electric Corporation, and Media Group Co. Ltd.
VRF Systems Market Segmentation
By Compressor Unit
By System Type
By Application Area