Building automation market grows, but labor shortage and uncertainty hinder HVAC industry

Due to optimistic GDP projections and well-planned investment strategies, we anticipate that the growth phase will persist. Both India and Southeast Asia are expected to exhibit robust growth.

HVAC industry 2023

The projected GDP growth for India in 2023-24 is 6.5 percent, leading us to anticipate an 8-9 percent expansion in the HVAC market for the upcoming year. The government has pledged to transform India into a Manufacturing Hub and attract significant investment. Various segments such as Datacenters (13%), Pharma (7%), Hospitality (7%), and Infrastructure (7%) have continued to experience YoY growth.

The government has reiterated its commitment to COP-26 and placed a focus on sustainability and energy efficiency. In August 2022, the Energy Conservation Bill was amended. Although the GDP forecast is frequently being revised downward, and there are global concerns about a recession, we must monitor market developments in 2023. Currently, the outlook is very positive, and the market is growing.

ACREX expo after Covid

As the first major ACREX expo to open since Covid-19, I anticipate an outstanding response. Industry players seek innovative and energy-efficient products that meet the market demand for healthy indoor air quality. I am confident that participating companies will showcase their creativity and ingenuity.

The spotlight will be on three macroeconomic factors: healthy indoor air quality, energy efficiency, and digitalization for ease of connectivity. Products and technologies will be closely tied to these three market trends, with features catering to end-user requirements. The focus will shift towards end-users, emphasising the total cost of ownership rather than just capex or opex.

Innovation Award in the IAQ category

Belimo is dedicated to maintaining its position as a market leader in innovation and quality and is committed to resolving customer issues and defending against competitors. A notable achievement was launching a new line of room sensors and operating units in late summer, winning the prestigious 2023 AHR Expo Innovation Award in the Indoor Air Quality category. Belimo primarily focuses on heating, ventilation, and air conditioning applications, to provide customers with greater value. Belimo’s mission is to “Create Healthier Indoor Comfort with Less Energy,” The company invests in innovation and aims to achieve market and technological leadership. Maintaining leadership in providing solutions requires far-sighted investment in research and development. The key performance indicators for this are the resources dedicated to research and development as a percentage of net sales. This percentage has remained stable over the last five years, with a rate of 7.3 percent in 2022.

Positive trends for HVAC

The building automation market is experiencing above-average growth due to increasing emphasis on energy efficiency and indoor air quality. However, the need for more qualified labor constrains this growth. Additionally, uncertainty around the global economy and higher interest rates may negatively impact investment decisions in the non-residential building market. Geopolitical implications and supply chain challenges could also affect the market in 2023. Positive GDP forecasts and structured investment plans in India and Southeast Asia are expected to drive continued growth, particularly in verticals such as data centers, healthcare, pharma, infrastructure, and technology parks.

At Belimo, we have set goals to create healthier indoor comfort with less energy and aim to leverage our efforts further.