2020 and beyond

Merging and

integrating markets

Chicago 26th

& 27th

January 2015

2 Excellence in Market Intelligence

Heating and Cooling Markets

Agenda

• Global HVAC market and dependence on China

• Air conditioning futures – evolution not revolution

• The new rising star – data centers and new solutions

• How much change at product level? Energy efficiency changes large or small?

• Powerful companies positioning themselves for the future in hvac

• The great gap in the markets

• Threats as the cloud and software take over our industry

2

3 Excellence in Market Intelligence

China domination – production, size and

growth

3

11.4

Total ‘Million

units: 1.5 94.7 1.0 8.5 0.4

China dominates except: • Unitary and chillers (USA)

• VRF Japan

• Moveables(Thailand)

China accounts nearly 45%of

world growth by volume: • Brazil and USA the other main

engines

4 Excellence in Market Intelligence

Products – Evolution not Revolution

4

Chilled ceilings &

beams

Energy efficiency

DOAS/

Indoor air quality

Solar cooling

Smart products

VRF

Green data

centre

cooling

Anti-

pollution

filters

Anti-

mosquito

Dedicated

Outdoor Air

Quality Systems

Solutions

provider

AC with

voice

control

5 Excellence in Market Intelligence

Gas boilers and alterative heat generators

Sales volume outlook by 2020

units

-

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

Italy UK Germany France Netherlands

n-c gas boilers c gas boilers heat pumps Hybrid heat pumps Fuel cells

By 2020 gas condensing boilers will still dominate main European heating markets

5

6 Excellence in Market Intelligence

AC : First tier

6

Gree

Daikin Mitsubishi Electric

FR

DE

IT

SP

UKOther Europe

USA/ Canada

Japan

China

FR

DE

IT

SP

UKOther Europe

USA/ Canada

Japan

China

Split

VRF

Other AC

FR

DE

IT

SP

UKOther Europe

USA/ Canada

Japan

China

7 Excellence in Market Intelligence 7

Many Opportunities in Retrofit

Non-Residential Building Stock by Age, EU-27,

2011

Non-Residential Building Stock by Age, USA , 2011

Pre 1960

41%

1960 - 1990

44%

1991 - 2010

Pre 1960 1960 - 1990

1991 - 2010

15%

33%

52%

15%

EU USA

Buildings built 1960 – 1990 represent big retrofit opportunity….

8 Excellence in Market Intelligence

All heading for the cloud?

8

The Cloud –

• 24 hr Universal Access

• OPEX not CAPEX

Cyber security

0%

5%

10%

15%

20%

25%

30%

35%

BEMS/BACSMonitoring &Management - inthe CloudPenetration

Source: BSRIA Estimates

Assumes 10-11%

CAGR up to 2020

9 Excellence in Market Intelligence

Will controls just become another

commodity?

9

Automation companies

lose the field to the IT

software/ web giants?

How to move up the

value-chain?

New Skills Needed

10 Excellence in Market Intelligence

BSRIA – more expert than the experts

(because we talk to them all!)

10

1000s sales visits/contacts at

Trade Fairs & Exhibitions

Local Partnerships

500+ BSRIA Publications

In-house engineers &

Test laboratory

Electronic journals

BSRIA’s technical library

Data collection groups

Congresses

1000s research visits/2000 telephone

and interviews each year