Saurabh Kabra , Director – Business Operations India , Truvison Industries Pvt. Ltd.

The Indian AC industry has witnessed a hike in terms of not just demands of the consumers but also technology and post-sales services. The 360-degree cut-throat competition of the market has led the brands to escalate the quality, technology, and services but reducing the price band.

The market could be acknowledged by two distinct segments, that is domestic and commercial. On the course, the air conditioning systems have undergone a wide acceptance in not just tier-II but also tier-III markets, witnessing a surge in demand from both commercial and residential applications. The aspect that grew popular is the smart thermostats technology and for the innovation, inverter air conditioners rising with increasing adoption. This wide usage and the adoption of new technology have projected a growth in CAGR of over 10 percent during 2015–2020. The demand for air conditioners which was primarily recorded in tier-I cities is gradually shifting toward tier-II and tier-III cities as well.

Another segment, the room air conditioners (split air conditioners), has witnessed a higher revenue share. On the other hand, the commercial segment is also catching up with the increase in demand for commercial plots, offices, stores, and business apartments.

Air conditioner manufacturers have been innovating the technical aspects to offer the consumers more convenient and capable solutions; from omnipotence, controllability, to AI interaction. The new energy saving ISEER rating implemented from this year, has made energy efficiency parameters even more stringent, most players are working on crafting their inverter AC product portfolio more robust this summer season.

Since the inverter-type air conditioners reduce the energy usage by up to 30 percent and also that, inverter ACs are now available at potently affordable prices, the fragment will tangibly witness a rapid global adoption from 2016 to 2020. Speaking of technical trends, the inverter air conditioners, utilize a variable speed compressor that swithers off upon attaining the desired temperature and switches on when the temperature changes. Vendors, very recently have also introduced other features such as sleep-state technology, whereby a sensor detects when users fall asleep and control the temperature settings to optimize comfort and efficiency.

One of the very rising concerns of pollution, inhalation of polluted air has driven vendors to introduce separate air purifying technologies. Several air conditioner brands are now integrated with the innovative air purification systems, which eliminates the need to purchase a separate unit for air purification. The newest air conditioners contain a layered filtration and active technologies that not just reduce the obnoxious elements, harmful to the humans, but also deliver oxygen-rich air.

In the course of pushing the environmental boundaries with advancements, vendors have also come up with energy-saving and eco-friendly refrigerants in the air conditioners that transfer heat while circulating the refrigerant between the indoor and outdoor units. Technical upgrades over the global podium are very competitive and challenging with low product differentiation. Therefore, to gain a competitive edge, manufacturers are inclined to embed several different types of refrigerants to differentiate their offerings and reduce the impact on the environment. The tech has led the air conditioners department to evolve from CFC usages to environmental friendly refrigerants. This also controlled a drastic amount of carbon footprint.

Overall, the air conditioning industry expects a burgeoning boom in the AC industry due to the temperature rising globally. The Indian Meteorological Department (IMD) forecasts average temperature being above normal by more than 1°C in most of the country from March to May. The air conditioners market and essentially the inverter operable ACs are tangibly envisioned to grow exponentially; since the kind of awareness and focus has been created by companies to the consumers. Moreover, the sales will be picking in the coming decade in tier-II and tier-III cities due to the increased disposable income and changes in standard of living of the people.