After 20 years of Fenghua, China’s air-conditioning industry has metamorphosed into a ＂resilient era＂
On August 23, 2023, under the guidance of the China Household Appliances Association and sponsored by China Home Appliances Network, the "2023-2024 China Air Conditioning Industry Summit Forum" was held in Dalian. Air conditioning companies and upstream parts companies including Oaks, Casarte, Changhong, GMCC & Welling, Haier, Haili, Hisense, Commander-in-Chief, Konka, Meibo, Meibang Linjie, Midea, Panasonic, TCL Air Conditioning, etc., as well as exclusive conference channel partner JD.com Home Appliances, special content cooperation platform Zhihu, etc., participated in this conference.
The industry can still take advantage of the trend change
At the meeting, Wang Lei, Secretary-General of the China Household Appliances Association, first expressed his affirmation of the contribution of the China Air Conditioning Industry Summit Forum to the industry. She mentioned that the 20 years of the forum have also been a prosperous 20 years for China’s air conditioning industry. During the 20 years, the forum has played a positive role in sharing development, gathering market information, building industry consensus, and supporting industry progress. In the future, with the new changes in the macro environment and the mission and responsibility of the air conditioning industry, I hope the forum can make persistent efforts and continue to make new contributions to the development of the industry.
Wang Lei, Secretary General of China Household Appliances Association
She also mentioned that in recent years, the sales of air conditioners have fluctuated greatly, but while paying attention to the short-term behavior of the market, we should also focus on the medium and long-term trends of the industry to carry out product technical reserves, especially in the context of global warming and frequent extreme weather. In the environment, air conditioners are changing from an optional product that improves the comfort of the living room environment to a rigid product that protects the health of users in extreme hot weather. The change of product roles will also reshape the growth mission and social responsibility of the industry. She called on air conditioner companies to pay attention to the improvement of technology such as product comfort and health, but also pay attention to the issues of energy conservation, environmental protection, and carbon reduction throughout the product life cycle.
Lv Shenghua, Editor-in-Chief of China Home Appliance Network
As the representative of the forum organizer, Lv Shenghua, editor-in-chief of China Home Appliances Network, reviewed the development of the air-conditioning industry in the past 20 years. He mentioned that in 2004, the domestic retail sales of household air conditioners in our country was only 23 million units, and by 2022, this value exceeded 50 million units; in 2004, our country’s air-conditioning exports were about 22 million units, and by 2022, this figure reached 62 million units. In the past 20 years, air conditioners have also changed from consumer discretionary in our country to a must-choose product. China Home Appliances Network is not only an observer and recorder of the industry, but also a promoter of the healthy development of air conditioners in China. Facing the future, the development of China’s air-conditioning is still "on the road". He explained the four major factors that will affect the future of the industry from four aspects, namely population, energy, technology and climate. He said that the demand of the market comes from people, and people are also producers at the same time. Demographic characteristics will have a long-term impact on the demand and production of air-conditioners, scale and trend. In addition, energy will also affect the air-conditioning industry from the supply and policy supervision levels. For example, the implementation of the national dual-carbon strategy has raised new issues for the green development of the industry. In addition, technology has become the most active factor of productivity, and technological innovation is reshaping the future of the air-conditioning industry. At the same time, as the air-conditioning industry that "depends on the sky to eat", the process of climate change will also Air-conditioning companies should start from the above four aspects and consider how to better face and meet the future.
Senior industry expert Cai Ying
In the face of the new situation of the development of the air-conditioning industry, senior industry expert Cai Ying analyzed the industry from the general trend and details of macroeconomic development. Cai Ying said that in the future, the positioning of consumption in the "troika" may be raised relatively high, which is determined by the development trend and development model of our country’s market. This positioning change will further affect the national financial policy, fiscal policy, tax policy, etc., which can become a guide for home appliance enterprises. In addition, he suggested that enterprises pay attention to rural resettlement housing, channel sinking in rural areas and the opening of the last mile of county logistics, as well as people’s livelihood security projects such as livable renovation and age-friendly home renovation in cities and towns.
He also pointed out some of the risks facing the industry, he mentioned that the consumption structure of our country’s society is changing from a survival model to a development model, and the proportion of durable consumer goods such as home appliances in the overall consumption of society is gradually decreasing. From this perspective, how to improve the attractiveness of products and maintain the market share of enterprises needs to be considered urgently. The second is how the home appliance industry can break through the bottleneck of stock and create new sources of volume, which is also a top priority. At the same time, he stressed that enterprises should still pay attention to foreign trade orders.
Focusing on universal quality upgrades and exploring new tracks
Zhao Meimei, Assistant President and General Manager of Research and Innovation Department of Aowei Cloud Network
At the meeting, Zhao Meimei, assistant to the president and general manager of the research and innovation department of Aowei Cloud Network, analyzed the operation of the air conditioner market in the first half of this year. In terms of the home appliance market, the retail sales of all household appliances increased by 4.4% in the first half of the year, and the retail sales of air conditioners increased by 19.5% in the same period. Zhao Meimei believes that the growth rate of air conditioners in the second half of the year has entered a narrowing range, and it is expected that the annual growth rate of the air In terms of specific channel performance, in the first half of the year, the retail sales of air conditioners reached 37.27 million units, an increase of 18.8% year-on-year, and the retail sales were 130.20 billion yuan, an increase of 19.5% year-on-year; among them, the sales volume of online channels was bright, and the retail sales volume was 21.29 million units, an increase of 33.0% year-on-year, and the retail sales volume was 66.20 billion yuan, an increase of 35.8% year-on-year; the offline retail volume was 15.97 million units, an increase of 4.0% year-on-year, and the retail sales volume was 64 billion yuan, an increase of 6.4% year-on-year. It can be said that online bears the role of industry scale expansion, and offline has become the main battlefield for enterprises to push up and sell new products. She mentioned that in terms of cold year statistics, the growth rate of the air conditioner market in 2023 reached a high point in
From the perspective of market segmentation, the K-type consumption differentiation of air conditioners is still relatively prominent, the high-end demand of users continues to strengthen, and the middle and low-end demand constitutes the "universal majority". However, even at the lower end of the K-type curve, users’ pursuit of products is also transitioning from "cost performance" to "quality-price ratio". Upgrading under grading is a major trend in the industry. From the perspective of industrial upgrading, new selling points such as healthy sterilization and fresh air have gradually become a winning weapon for enterprises to increase product premiums, while sub-segments such as functional integrated products, large-scale on-hook and central air conditioners, embedded solutions, and kitchen air conditioners have performed well, becoming a new bright spot for enterprise growth. Overall, although the demand for 2024 cold year is overdrawn, in the long run, the industry is still in a normal cycle of development.
Zhang Daquan, Senior Engineer of the National Climate Center
In the sharing of the guests, the impact of weather on the industry was frequently mentioned, and the extreme high temperature and extreme precipitation that occurred in many places in our country this year also left everyone with lingering fears. In the eyes of Zhang Daquan, a senior engineer at the National Climate Center, these extreme weather are by no means accidental. He believes that climate warming is exacerbating the risk of global high temperature waves through his continued attention to climate characteristics in different regions of our country and a summary of climate change on a global scale.
Zhang Yanpeng, Head of Central Air Conditioning, Home Appliances and Air Conditioning Business Department, JD.com
Zhang Yanpeng, the head of the central air-conditioning department of JD.com Home Appliances and Home Air Conditioning Business Department, introduced the air-conditioning sales of JD.com channels for everyone. He mentioned that in the first half of 2023, JD.com air-conditioning sales growth outpaced the market, and in the second half of the year, JD.com will revolve around the "home scene" under the changes of user requests, from the four aspects of amphibious users, content shopping guide, service advantages, and trend track to plan the air-conditioning operation idea.
The "amphibious users" mentioned here refer to the rapid growth of the middle class in small towns and young people in small towns driven by the wave of youth returning to their hometowns for employment. In response to this, JD.com has strengthened the lower-tier market layout with specialty stores as the core. He mentioned that for amphibious users, their air conditioner purchases are almost synchronized with home decoration, so the layout of home appliances and home decoration, which is convenient for users to buy one-stop, has become the focus of the upgrade of JD.com stores in the past two years. In terms of air conditioner quality services, JD.com not only provides a better installation experience, but also cooperates with various brands to vigorously promote trade-in work. It is reported that in the first half of JD.com’s air conditioner sales, rigid demand replacement accounted for nearly 50%, and trade-in is becoming a large market. Around this point, JD.com has launched measures such as the first year of air conditioning only replacement without repair, free cleaning once in the first year and a subsidy of 100 yuan for air conditioning delays to further upgrade the user experience. And on the excavation of trend tracks, JD.com found that fresh air conditioners, large-volume hangers, air duct machines, and kitchen air conditioners focusing on kitchen scenes all showed a good growth rate in JD.com’s air conditioning system. These sub-tracks have opportunities to break through.
Unafraid of cyclical fluctuations, innovation leads to long-term stability
Bai Jun, head of Casarte air conditioner brand
Bai Jun, head of the Casarte air conditioner brand, said that in the first half of the year, Haier’s air conditioners focused on stabilizing scale, promoting retail sales, and improving structure. Omni-channel retail sales increased by 17% year-on-year, and the high-end share exceeded 40%. Behind the achievements is Haier’s advanced layout in the field of products and technologies. On the technical side, it has improved indoor air quality around good air, good performance, and good quality. The appearance has been refined, and the UI interface has been improved. It has achieved a "three-line integration" from product technology to listing to user experience, providing users with a better experience. The company’s jet uniform wind technology has solved the problems of cold and hard air conditioning, and direct blowing users are prone to air conditioning diseases. It has realized softer air outlet and more comfortable use. In addition, in terms of improving the performance of air conditioners, Haier Air Conditioning has independently developed the revolutionary green technology of variable diversion from user request. Through the redesign of the traditional refrigeration system, the single fixed refrigerant flow path has become flexible and variable, so that the refrigeration and heating effect of air conditioners can be maximized to achieve efficient cooling and energy saving.
Zhang Xu, Deputy General Manager of Hisense Air Conditioning Pre-research Technology Department
Zhang Xu, deputy general manager of Hisense Air Conditioning Pre-Research Technology Department, mentioned that empathy for user requests and feedback on good experiences are becoming a docking point for Hisense to resonate with customers. Through user research, they believe that air, air conditioners and users constitute a small ecosystem of the family. In the past, the industry mainly studied how air conditioners regulated the air, but ignored the impact of air on users. Through user empathy, they discovered the multi-dimensional air management factors of air conditioners, making the product a five-dimensional air housekeeper of "temperature, humidity, wind, net and oxygen" in the family. For example, human body comfort is greatly affected by temperature and humidity, and sometimes only lowering the room humidity without lowering the temperature can create a comfortable environment. Hisense has developed a temperature and humidity dual-control technology to create a more comfortable environment by increasing the dehumidification rate without lowering the temperature.
Zhang Hao, R & D director of Midea’s home central air conditioner, mentioned that Midea’s air conditioner is deploying smart air solutions for the whole house, allowing every family to enjoy a smart, comfortable and healthy life through efficient use of space, good air and customization. In the long run, China’s air conditioner is facing some new opportunities and challenges. Green and low-carbon has become an important evolutionary trend in the industry. Chinese air conditioner companies need to continuously develop more low-carbon and environmentally friendly products to meet consumers’ demand for environmentally friendly products. In addition, the rapid development of smart home and Internet technologies has also brought new prospects to the air conditioner industry.
Jin Hailong, General Manager of Guangzhou Songxia Air Conditioner Co., Ltd.
Jin Hailong, general manager of Guangzhou Panasonic Air Conditioning Co., Ltd., said that there are currently two mainstream trends in the air conditioning industry, one is health and comfort, and the other is low-carbon development. With consumers paying more attention to the health of the home environment, Panasonic has carried out a lot of exploration of air conditioning health and comfort technologies, such as applying patented Nanoyi technology in products, developing fresh air and oxygen-enriched products. In 2025, they also plan to launch a new air conditioner that can achieve the effect of water-free humidification, effectively improving the comfort of living rooms in dry environments. In addition, in April 2022, Panasonic formulated short, medium and long-term carbon reduction targets for 2025, 2030 and 2050 from the group level. As far as air conditioning products are concerned, the application of environmentally friendly refrigerants such as R290 will become a key consideration for enterprises. The safe use of R290 will increase, but consumers will not have a direct perception of it. Enterprises need to resolve the burden of increased costs by themselves. For enterprises, it is a practice of social responsibility. It is reported that Panasonic has started R290 market exploration in Europe, and will gradually promote the use of R290 refrigerants in Japan and China in the future. In addition, Panasonic air conditioners are also promoting the use of recycled materials. The cost of recycled materials is also about 30% higher than that of ordinary materials. How to achieve corporate social responsibility without increasing the burden of consumer spending and without reducing product functions requires industry consensus.