BSRIA extends geographical scope of its AC studies with Latin American countries February 2020

Following our latest regional AC study in Africa, published in December 2018, BSRIA has now focused its attention to the air conditioning market in Latin America as part of its Regional AC portfolio published on a rota basis each year. These are challenging markets with political and economic fluctuations, but are also in many ways immature markets, which offer commercial opportunities.

BSRIA estimates that the total AC market in Latin America across 4 regions has reached close to USD 5  bn in 2019, a YoY market growth of 6%, exceeding that of North America. Over 8.9 million units were sold in 2019 of which 90% were splits.

Brazil’s AC segment is growing notwithstanding the unstable economic performance and political changes affecting consumers’ confidence in 2019. In the white and brown electro-domestic product categories, AC is amongst the few segments with an upward trend in sales. 

Argentina has been suffering the effects of the economic crisis in mid-2018 when doubts rose about the government’s financial commitments causing the local currency to further drop in 2019. Not all AC product segments were affected to the same degree and a double digit growth was recorded in the mini VRF (<20kW) segment. 

The same can be said for Mexico which has also seen an increase in VRF. Despite the negative economic cycle which has made consumers increasingly price driven, inverter adoption has dramatically increased in 2019 as well as the implementation of new refrigerants in chillers and residential units (R32).

Looking beyond the largest three markets, underlying growth potential has been reported across the region. 

Tourism and a buoyant manufacturing activity of medical devices are the main drivers in the development of Costa Rica. Despite the current economic stagnation, these two industries will continue to generate demand for both residential and commercial air conditioning in the longer term.

In Chile the potential for residential AC growth following the transition from unsophisticated heating practices remains high. In the Dominican Republic the demand for cooling is on the up thanks to an increased disposable income, a growing population and a boost from the hospitality sector.

The main barrier to market expansion for residential AC remains affordability in a country like Colombia where poverty levels are still high. More opportunities are seen in AC commercial applications, a sizeable segment in the country. Small offices, retail units and some government buildings adopt single splits as an affordable alternative to other more expensive solutions including rooftops and applied.

The AC market in Panama is the largest in Central America despite the size of its population, which is the smallest in the region after Belize. The economic relevance of Panama is due to the existence of the Canal making the country one of the most important trade hotspots in the world. The outlook is for a slow recovery of investments in construction which will translate in a growth in the AC market expected by most suppliers to kick off in 2021 whereas the outlook for 2020 remains uncertain. 

In Puerto Rico construction of buildings and sales of AC started picking up in 2019 following the hurricane Maria in 2017. The country is amongst other states announcing their plans to follow California’s lead on HFC phase-downs.

With a growth by value close to 5%, Peru remains a market dominated by single ductless split units. Energy saving concerns are favoring the penetration of inverters and the adoption of VRFs.

BSRIA’s Latin America Regional Study covers 10 major markets researched individually: Argentina, Brazil, Chile, Colombia, Costa Rica, Dominican Republic, Mexico, Panama, Peru and Puerto Rico. The remaining countries are estimated through pan-regional interviews and modelling and combined as others among 4 regions: North, Central, South and Caribbean.

To find out more about the Latin American AC market, please contact us at:

• America sales enquiries: BSRIA USA: ¦ +1 312 753 6803
 • China sales enquiries: BSRIA China: ¦ +86 10 6465 7707
 • All other sales enquiries: BSRIA UK: ¦ +44 (0) 1344 465 540

Contact BSRIA Worldwide Market Intelligence

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