Saudi Arabia is one of the biggest and most promising markets for air-conditioning products in GCC region, predominantly due to its geography, climate, high per capita income and rapid population growth. However, economic slowdown in the view of meltdown in oil prices has cast a shadow on the region’s air conditioner market. Delay and suspension of construction projects led to fall in sales of air conditioning units in the country. Announcement of new contracts to be awarded were deferred and payments to contractors working on projects were delayed, attributed to liquidity shortage of the government and high fixed costs incurred by contractors.
According to 6Wresearch, Saudi Arabia Air Conditioners market revenue is projected to reach over $1.96 billion by 2023. Saudi Arabia, being an oil based economy over two decades, as part of its Vision 2030 plan is now aiming to increase the overall non-oil government revenues from $43.5 billion to $160 billion by 2020, and to $266.6 billion by 2030 in the aftermath of slump in oil prices. Privatization of government services to encourage private sector investments in healthcare, housing, finance and energy sectors would further add to the growth. Riyadh, has set the target of increasing the private sector’s contribution to GDP, which is currently pegged at 40% and to reach 65% by 2030. Air conditioner market growth is relatively buoyant amidst the government initiatives and in turn is anticipated to exhibit strong demand for air conditioners over the coming years.
According to Sathi Paul, Senior Research Analyst – IT & Electronics, Research and Consulting, 6Wresearch, “Centralized air conditioner systems were in strong demand primarily on account of continued spending in infrastructural and hospitality projects. Strong demand for energy efficient air conditioners and growth in infrastructure, housing and commercial developments have driven the demand.”
Additionally, “Centralized air conditioning units predominantly chillers and VRFs are expected to gain stronger foothold in Saudi Arabia’s air conditioner market over the next six years owing to expected recovery of government spending and growing commercial units in the country.
“Market players in air conditioner market are expanding their product lines for VRF systems and high efficiency high wall mounted split units equipped with inverter technology, which are in complaint with new Saudi Arabian Standards Organization regulations,” Sathi further added
According to Rishi Malhotra, Research Analyst – IT & Electronics, Research and Consulting, 6Wresearch, “Considerable amount of revenues for air conditioning units in Saudi Arabia were garnered from the residential application followed by significant contributions from the commercial & retail, and oil & gas applications.”
Additionally, “Government’s decision to develop tourism and attract more tourists to the country is expected to attract significant investments in hospitality and infrastructure construction. Saudi Arabia has a pipeline of noteworthy projects primarily in the cities of Jeddah and Riyadh, which in turn is likely to boost the demand for air conditioners in hospitality application.”
KSA plans to expand the number of existing hotel rooms as a part of the 2030 Vision. Following the vision, KSA is anticipated to increase annual capacity of hotel rooms to 15 million by 2020 and 30 million by 2030,” Rishi further added.
Key contributing vendors in Saudi Arabia Air Conditioner Market include – AHI Carrier Fzc, Daikin McQuay Middle East and Africa FZE, Fujitsu General (ME) FZE, GREE Electric Appliances Inc., Johnson Controls (York), LG Electronics, Inc., S.K.M Air Conditioning LLC, Samsung Electronics Co. Ltd., Trane INC. and Zamil AC.
“Saudi Arabia Air Conditioner Market (2017-2023)” provides in-depth analysis covered in more than 100 pages. The report estimates and forecast the overall Saudi Arabia Air Conditioning market by revenues, air conditioner type, applications and regions. The report also gives key insights on competitive landscape, players revenue share, company profiles, market trends, market drivers and restraints.