U.S. HVAC Rooftop Units Market Size, Share & Trends Analysis Report By Capacity (Up To 3 Tons), By Distribution Channel (New Installation), By Application (Residential), And Segment Forecasts, 2024 - 2030

U.S. HVAC Rooftop Units Market Trends

The U.S. HVAC rooftop units market size was estimated at USD 9,031.7 million in 2023 and is projected to grow at a CAGR of 4.8% from 2024 to 2030. The market growth can be attributed to the rising demand for cost-effective and energy-efficient space cooling and heating systems in commercial applications in the U.S. Moreover, the surging demand for heating equipment with a high seasonal coefficient of performance (SCOP), which can work efficiently in both winter and summer, is expected to fuel the market's growth over the forecast period. Government initiatives in the form of rebates and incentives for promoting clean heating and cooling equipment are expected to positively impact the demand for HVAC rooftop units in the U.S. over the forecast period.

The rising total construction projects across the U.S. are set to significantly boost the demand for HVAC rooftop units. This upsurge is primarily driven by the expanding urban infrastructure, commercial buildings, and residential complexes, which necessitate efficient HVAC systems for sustainable and comfortable living environments. As construction activities grow, the need for innovative and energy-efficient HVAC solutions is becoming more pronounced, making rooftop units an essential component of modern architectural designs.

Drivers, Opportunities & Restraints

The rising construction spending in the U.S. coupled with the maintenance & replacement operations related to HVAC rooftop units is anticipated to fuel the demand for energy-efficient heating solutions. The U.S. construction industry focuses on the development of sustainable and energy-efficient buildings. Leadership in Energy and Environmental Design (LEED) is a green building certification system developed by the U.S. Green Building Council (USGBC) that focuses on increasing energy consumption to lessen the environmental impact of excessive energy usage. These factors are expected to drive the demand for HVAC rooftop units in the U.S.

Furthermore, the availability of federal income tax credits is significantly driving the demand for HVAC rooftop units in the U.S. by directly influencing homeowner decisions toward energy efficiency and clean energy adoption in two crucial ways. Moreover, the incentive to reduce costs associated with energy-efficient home improvements by up to 30%, annually until 2032, makes the upfront investment in energy-efficient HVAC rooftop units financially more appealing. Homeowners are more likely to opt for these high-efficiency units when tax credits offset a portion of the cost, thus increasing demand.

The availability of chillers can potentially restrain the market growth. Chilterns offer an alternative solution for large-scale commercial and industrial cooling needs, often perceived as more efficient and cost-effective for certain applications. For instance, a large data center or manufacturing facility might opt for a chiller-based system over rooftop units due to the former's superior efficiency in managing the cooling loads of such expansive spaces. This can limit the demand for rooftop units, particularly in sectors with continuous cooling requirements, thereby impacting the market growth for HVAC rooftop units in the U.S.

Industry Dynamics

The industry growth stage is medium, and the pace is accelerating. The market is characterized by a high degree of innovation, which is attributable to the rapid technological advancements. Moreover, market players are adopting organic and inorganic growth strategies, such as product launches, geographical expansions, mergers & acquisitions, and collaborations, to strengthen their position in the global market.

Regulations play a significant role in shaping the market dynamics, influencing everything from product design to operational practices. The recent enhancement of existing tax incentives, such as the 179D tax deductions and the 45L tax credits, aims to encourage greater energy efficiency in commercial and multifamily buildings. This legislative push toward sustainability and energy efficiency is likely to impact the HVAC rooftop units market in several ways.

The growing emphasis on energy efficiency, sustainability, and the need for improved indoor air quality within various sectors drives product demand among end users. HVAC rooftop units are widely utilized in commercial applications to provide centralized heating, cooling, and ventilation in various settings, including offices, retail stores, and schools. Their rooftop installation optimizes space utilization and delivers efficient climate control tailored to the specific needs of commercial spaces.

The threat of substitutes for the U.S. HVAC rooftop unit market is moderate. These alternatives, ranging from split systems to portable and window units, offer several advantages that attract residential and commercial users. For instance, split system air conditioners are gaining popularity for their flexibility in installation and operation, allowing for a more targeted approach to heating and cooling specific areas of a building.

Capacity Insights

“The demand for 25 to 45 tons segment is expected to grow at a significant CAGR of 5.1%  from 2023 to 2030 in terms of revenue”

The 3 to 7-ton segment held the largest share in 2023. HVAC rooftop units (RTUs) with capacities ranging from 3 to 7 tons are essential for medium-sized commercial spaces, such as larger retail stores, restaurants, small office buildings, and educational facilities. Depending on the building's insulation and climate, these units are designed to handle spaces between 1,500 and 3,500 square feet.

The demand for 25 to 45 tons segment is expected to grow at a significant CAGR from 2023 to 2030 in terms of revenue. The 25- to 45-ton HVAC rooftop units are extensively used for large retail malls, expansive office complexes, hospitals, large educational institutions, and manufacturing facilities. These units can handle areas typically between 20,000 and 45,000 square feet and provide powerful and efficient heating, ventilation, and air conditioning.

Distribution Channel Insights

“The demand for new installation segment is expected to grow at a significant CAGR of 5.4%  from 2023 to 2030 in terms of revenue”

The replacement distribution channel segment held the largest share in 2023. Several key factors, including the aging infrastructure of existing buildings, advancements in HVAC technology, increased regulatory pressures, economic considerations, and a focus on energy efficiency and sustainability, drive the demand for HVAC rooftop unit (RTU) replacements. Furthermore, older RTUs require more frequent and expensive maintenance.

The demand for the new installation segment is expected to grow at a significant CAGR from 2023 to 2030 in terms of revenue. Owing to a significant rise in construction spending across the U.S., the demand for new HVAC installations is anticipated to rise in the coming years, as these RTUs with advanced filtration systems can significantly improve air quality and reduce the spread of airborne diseases and allergens.

Application Insights

“The demand for industrial application segment is expected to grow at a significant CAGR of 4.5%  from 2023 to 2030 in terms of revenue”

The commercial segment held the largest share of 79.6% in 2023. According to the U.S. Census Bureau, the total construction spending in 2023 reached USD 2,096.0 billion, marking a significant increase of 9.0% compared to USD 1,840.9 billion in 2022. This notable uptick in spending on commercial buildings can be attributed to evolving business demands, urbanization trends, rapid industrial expansion, and overall economic growth.

The demand for HVAC RTUs in the industrial segment is expected to grow at a significant CAGR, in terms of revenue, from 2023 to 2030. HVAC RTUs are crucial for the industrial sector as they provide efficient climate control, offer high air quality, ensure compliance with regulations, and support operational efficiency. Industrial processes often generate dust, fumes, and other airborne contaminants that can compromise indoor air quality.

Regional Insights

“In the U.S., California is likely to dominate the market in 2023 and it accounted for 38.5% market share in 2023”

In the U.S., California is likely to dominate the market in 2023. The growth of the urban population results in a higher concentration of residential and commercial buildings. This has led to the installation of more HVAC systems to meet the heating and cooling needs within these structures. The rise in the construction of eco-friendly and smart buildings, which require advanced HVAC systems for energy efficiency and climate control, directly contributes to the expansion of the HVAC rooftop unit market. These units are favored for their ability to provide centralized cooling and heating while being space-efficient, making them perfect for the dense layouts of commercial and high-rise residential buildings.

Meanwhile, in states like Texas and Florida, where extreme temperatures are common, the demand for HVAC rooftop units is shaped by the need for robust and reliable cooling solutions. These regions' economic and population growth further exacerbates the need for effective climate control in commercial and residential buildings, leading to an increased installation of HVAC rooftop units.

For example, the rapid expansion of business districts and residential areas in cities like Houston and Miami underlines the critical role of efficient HVAC systems in providing comfort and maintaining air quality, underscoring the importance of rooftop units that can withstand harsh climates while ensuring energy efficiency.

Key U.S. HVAC Rooftop Units Company Insights

Some of the key players operating in the market include Carrier, DAIKIN INDUSTRIES, Ltd., Johnson Controls, and LG Electronics.

• Carrier, the provider of safe, sustainable, intelligent building and cold chain solutions, was acquired by United Technologies Corporation in 1979, but it was spun off as an independent company in April 2020. Carrier Global Corporation provides heat pumps, air conditioners, boilers, furnaces, air purifiers, humidifiers, dehumidifiers, ventilators, air scrubbers, thermostats, UV lamps, energy services, and building controls to retail, commercial, transport, and food service sectors

• DAIKIN INDUSTRIES Ltd. sells and manufactures air conditioning systems and chemical products. The company was formerly known as Daikin Kogyo Co., Ltd. and changed its name in 1982. It owns 313 consolidated subsidiaries worldwide and offers air-conditioning systems, room heating and heat pumps, hot water supply systems, room air conditioning systems, packaged air-conditioning systems, and air conditioning systems for plants, facilities, and office buildings

AAON and Danfoss are some of the emerging market participants in the U.S. HVAC rooftop units market.

• Danfoss manufactures products and provides air conditioning, refrigeration, heating, off-highway machinery, and motor control services. The company also operates in the field of district energy infrastructure, as well as renewable energy for residential and commercial industries

• AAON also offers three different series of rooftop units, including the RQ Series, which has five cooling dimensions available ranging from 2 to 6 tons; the RN Series, which has 28 cooling dimensions available that range from 6 to 140 tons; and the RZ Series, which has 15 cooling dimensions available in the range of 45 to 261 tons

Recent Developments

• In May 2024, Johnson Controls revealed the expansion of its acclaimed YORK Sun Premier commercial rooftop unit (RTU) portfolio, introducing new models ranging from 90 to 150 tons of capacity. Tailored for facilities, such as office buildings, hospitals, and educational institutions, these top-tier RTUs aim to diminish carbon emissions and bolster sustainability efforts while cutting operational and maintenance costs.

•  In May 2024, SAMSUNG announced a joint venture with Lennox International, Inc. for ductless and variable refrigerant flow HVAC systems and provided cooling and heating solutions across the U.S. and Canada. As part of this new partnership, SAMSUNG will hold a 50.1% stake, while Lennox will control the remaining 49.9%

U.S. HVAC Rooftop Units Market Report Scope

U.S. HVAC Rooftop Units Market Report Segmentation

This report forecasts revenue and volume growth at global, regional, and country levels and provides an analysis of the latest trends in each of the sub-segments from 2018 to 2030. For this study, Grand View Research has segmented the U.S. HVAC rooftop units market report based on capacity, application, distribution channel, and region:

• Capacity Outlook (Volume, Thousand Units; Revenue, USD Million, 2018 - 2030)

  • Upto 3 Tons

  • 3 to 7 Tons

  • 7 to 15 Tons

  • 15 to 25 Tons

  • 25 to 45 Tons

  • Above 45 Tons

• Application Outlook (Volume, Thousand Units; Revenue, USD Million, 2018 - 2030)

  • Commercial

    • Supermarkets & Hypermarkets

    • Retail Stores

    • Restaurants

    • Workspaces/Office

    • Shopping Malls

    • Other Commercial Applications

  • Industrial

  • Residential

• Distribution Channel Outlook (Volume, Thousand Units; Revenue, USD Million, 2018 - 2030)

  • New Installation

  • Replacement

• Regional Outlook (Volume, Thousand Units; Revenue, USD Million, 2018 - 2030)

  • Alabama

  • Alaska

  • Arizona

  • Arkansas

  • California

  • Colorado

  • Connecticut

  • Delaware

  • Florida

  • Georgia

  • Hawaii

  • Idaho

  • Illinois

  • Indiana

  • Iowa

  • Kansas

  • Kentucky

  • Louisiana

  • Maine

  • Maryland

  • Massachusetts

  • Michigan

  • Minnesota

  • Mississippi

  • Missouri

  • Montana

  • Nebraska

  • Nevada

  • New Hampshire

  • New Jersey

  • New Mexico

  • New York

  • North Carolina

  • North Dakota

  • Ohio

  • Oklahoma

  • Oregon

  • Pennsylvania

  • Rhode Island

  • South Carolina

  • South Dakota

  • Tennessee

  • Texas

  • Utah

  • Vermont

  • Virginia

  • Washington

  • West Virginia

  • Wisconsin

  • Wyoming