HVAC Trending: China’s VRF Market Has Further Growth Potential


China’s variable refrigerant flow (VRF) system market has experienced more than 20 years of continuous development. In 2021, it exceeded 1.33 million units, accounting for more than 64% of the global VRF market, according to JARN’s estimates. Year-on-year market growth reached 20.7% in 2021, with 25.4% for mini-VRFs and 12.7% for VRFs.
Despite such continuous growth, the VRF market still has the potential to grow further. According to aircon.com, China’s market stock of VRFs has surpassed RMB 450 billion (about US$ 67 billion) at present, which far exceeds new installation and offers a new growth potential point – renewal demand.

To seize more opportunities in this big potential market segment, manufacturers need to develop VRFs that are more energy efficient, healthy, comfortable, intelligent, etc.

Energy efficiency is a key word in the context of China’s carbon neutral policies. In the early-developed large cities, there are a large number of office buildings and public buildings that installed VRFs that are approaching the end of their lifespans now. In such buildings, old VRFs need to be replaced with new VRFs with higher energy efficiency.

In the post-pandemic era, VRFs equipped with functions such as air purification, sterilization, and fresh air supply have attracted more and more attention. In particular, during the pandemic, a large number of medical facilities that have been gradually renovated and upgraded to meet the strong demand for a safe environment which requires VRFs with healthy functions.

In addition to product upgrades, manufacturers must upgrade their services for VRFs. They must build a whole-process closed-loop management of pre-sale, in-sale, and after-sale services, which can enhance the comprehensive competitiveness of their brands.

Backed by such growth potential, Chinese VRF manufacturers have raised investments to strengthen their production capability.