Condensing Unit Market – Global Industry Size, Share, Trends, Opportunity and Forecast, By Type (Air-Cooled, Water-Cooled, Evaporative), By Function (Air Conditioning, Refrigeration, Heat Pumps), By Application (Commercial, Industrial, Transportation), By Region & Competition, 2020-2030F

Market Overview

Global Condensing Unit market was valued at USD 39.45 billion in 2024 and is expected to grow to USD 45.23 billion by 2030 with a CAGR of 6.76% during the forecast period. The Condensing Unit market is primarily driven by the growing demand for energy-efficient and environmentally friendly refrigeration systems. With the rise in commercial sectors such as food service, retail, and pharmaceuticals, the need for reliable and sustainable cooling solutions has increased. Technological advancements, including the development of low-GWP (Global Warming Potential) refrigerants and more efficient compressor technologies, are also contributing to market growth. Also, regulatory changes aimed at reducing carbon emissions and promoting sustainability are encouraging industries to adopt advanced refrigeration systems. As industries continue to expand globally, the demand for condensing units is expected to rise.

Key Market Drivers

Booming Food & Beverage Industry

The booming food and beverage industry is a key driver of the global condensing unit market. As a part of this, according to a recent study, the food market is expected to generate USD 9.68 trillion in revenue by 2025. The market is predicted to develop at a 6.43% annual rate (2025-2030 CAGR). As the demand for processed, packaged, and perishable food products continues to rise, the need for efficient refrigeration systems has significantly increased. Condensing units, which are vital for cooling and preserving food, are essential in various applications such as cold storage, refrigeration, and display cases. In the food and beverage industry, maintaining temperature control is critical to ensuring product safety, quality, and shelf life, making condensing units indispensable. The growth of supermarkets, restaurants, and convenience stores, along with the expanding e-commerce sector for food delivery, has further driven the demand for refrigeration solutions. As businesses look for more energy-efficient, cost-effective, and sustainable cooling options, condensing units with advanced technologies are becoming increasingly popular. Also, the global trend towards healthier food options and a higher preference for organic and fresh produce has spurred the need for reliable refrigeration systems that ensure proper storage and transportation. Also, regulations aimed at reducing food waste and energy consumption have encouraged industries to adopt modern condensing units, which are more energy-efficient and environmentally friendly. The food and beverage industry's expansion is expected to continue fueling the growth of the global condensing unit market for years to come.

Product Upgradation by Major Players

Product upgradation by major players is a significant driver of growth in the global condensing unit market. As a part of this, as of February 2023, Daikin Germany announced the availability of their new inverter-controlled CO2-ZEAS refrigeration condensing unit for medium and low temperature applications. The CO2-ZEAS product range, which was unveiled at the Chillventa show in October, consists of three models with nominal cooling capacities ranging from 19 to 32 kW and 11 to 17 kW deep-freezing. The cooling capacity can be increased by adding Daikin's Q-Up module. As the demand for more efficient, environmentally friendly, and technologically advanced refrigeration solutions increases, leading manufacturers are continually enhancing their products to meet the evolving needs of various industries. These upgradations often focus on improving energy efficiency, reducing operational costs, and enhancing overall performance. For instance, many companies are integrating low-GWP (Global Warming Potential) refrigerants into their condensing units to align with global environmental standards and reduce the harmful impact of traditional refrigerants on the ozone layer. Also, manufacturers are incorporating advanced compressor technologies, smart sensors, and IoT (Internet of Things) connectivity into condensing units, allowing for real-time monitoring, predictive maintenance, and remote diagnostics. These innovations help businesses optimize energy consumption, reduce downtime, and improve system reliability. Also, major players are focusing on developing modular and compact designs to make condensing units more versatile and suitable for a variety of applications, including smaller spaces or mobile units. This flexibility has expanded the use of condensing units across diverse sectors, such as retail, foodservice, and pharmaceuticals. Overall, continuous product upgrades by leading companies are key to maintaining competitiveness in the global condensing unit market and addressing the growing demand for sustainable refrigeration solutions.

Rise of Online Food Delivery Services

The rise of online food delivery services is a key driver for the global condensing unit market. As a part of this, according to a recent study, as of August 2024, the global online food delivery sector is expected to be worth more than one trillion US dollars in 2023, with grocery delivery accounting for 630 billion dollars and meal delivery accounting for 390 billion. By 2029, the online meal delivery sector is expected to generate revenues of 1.85 trillion US dollars. As consumer preferences shift towards the convenience of ordering food online, the demand for efficient and reliable refrigeration systems has surged. These services require advanced refrigeration solutions to maintain the quality and safety of perishable items, particularly during transportation and storage. Condensing units play a crucial role in keeping food at the proper temperature, ensuring that meals remain fresh and safe for consumption during delivery. With the rapid growth of platforms such as UberEats, DoorDash, and Deliveroo, as well as the increasing popularity of cloud kitchens, the need for temperature-controlled environments has become more critical. Condensing units are used in refrigerated delivery vehicles, storage facilities, and packaging systems to maintain the integrity of food products, reducing the risk of spoilage or contamination. Also, as food delivery services expand globally, the demand for energy-efficient, eco-friendly refrigeration systems has increased. Many companies are opting for advanced condensing units that use low-GWP refrigerants and feature smart technologies for real-time monitoring. This helps delivery services improve operational efficiency, reduce energy consumption, and comply with environmental regulations. As the online food delivery market continues to grow, it is expected to drive further demand for high-performance condensing units worldwide.

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Key Market Challenges

 High Initial Cost

The high initial cost of advanced condensing units remains a significant challenge in the global market. While these units are designed to be energy-efficient, environmentally friendly, and technologically advanced, their upfront costs can be substantially higher than traditional refrigeration systems. This is due to the incorporation of modern features such as energy-saving compressors, low-GWP refrigerants, IoT connectivity, and more sophisticated control mechanisms. For small and medium-sized businesses, especially those in emerging markets, the high cost of purchasing and installing these systems can be a major barrier. Although these units offer long-term savings through energy efficiency and reduced maintenance costs, the initial financial investment required may deter companies from adopting them. Also, retrofitting existing infrastructure with new, energy-efficient condensing units can incur additional expenses, further compounding the cost challenge. This becomes particularly problematic in industries such as foodservice and retail, where operational budgets are tight, and businesses are reluctant to invest heavily in refrigeration technology. However, as the market matures and production scales up, the cost of condensing units is expected to decrease, making them more accessible to a wider range of businesses. For now, overcoming the high initial costs remains a significant hurdle for widespread adoption.

Supply Chain Disruptions

Supply chain disruptions are a significant challenge facing the global condensing unit market. The manufacturing of condensing units relies on various components, such as compressors, refrigerants, motors, and electronic parts, many of which are sourced from different regions around the world. Any disruption in the supply of these materials, whether due to geopolitical factors, natural disasters, or global pandemics, can delay production and increase costs. In recent years, supply chain issues, such as shortages of critical raw materials like semiconductors and metals, have led to delays in the delivery of condensing units and their components. The ongoing challenges in logistics, including shipping delays, transportation bottlenecks, and rising fuel prices, further exacerbate these disruptions. This not only impacts manufacturers' ability to meet market demand but also drives up the cost of production, which may ultimately be passed on to consumers. Also, businesses may struggle to keep up with the growing demand for energy-efficient and environmentally friendly refrigeration systems due to these disruptions. For companies that rely on timely equipment upgrades and replacements, such as in the food service and retail sectors, delays in supply can hinder their operations and affect customer satisfaction. As the global supply chain stabilizes, addressing these challenges will be crucial for the continued growth of the condensing unit market.

Key Market Trends

Increasing Adoption of Low-Global Warming Potential Refrigerants

The increasing adoption of low-global warming potential (GWP) refrigerants is a key trend in the global condensing unit market, driven by the growing emphasis on environmental sustainability and regulatory compliance. Traditional refrigerants, such as hydrofluorocarbons (HFCs), have high GWP and contribute significantly to global warming. In response, industries worldwide are shifting towards refrigerants with lower environmental impacts, such as hydrofluoroolefins (HFOs), natural refrigerants like carbon dioxide (CO2), ammonia (NH3), and hydrocarbons (propane, butane), which have much lower GWP values. This shift is being driven by international agreements such as the Kigali Amendment to the Montreal Protocol, which aims to phase out high-GWP refrigerants. As a result, businesses are increasingly adopting condensing units that use these environmentally friendly refrigerants to comply with regulatory standards and reduce their carbon footprint. Also, many countries are implementing stricter regulations, incentivizing companies to transition to low-GWP alternatives to meet sustainability goals. The adoption of these refrigerants also aligns with consumer demand for more eco-conscious and sustainable products. Condensing units utilizing low-GWP refrigerants are gaining popularity across sectors such as retail, foodservice, and transportation, where refrigeration plays a critical role in operations. As technology evolves, the development of even more efficient, low-GWP refrigerants will continue to shape the future of the global condensing unit market.

Technological Advancement

Technological advancements are significantly shaping the global condensing unit market, driven by the need for improved efficiency, reduced environmental impact, and enhanced performance. One of the key trends is the integration of smart technologies such as IoT sensors, real-time monitoring systems, and artificial intelligence (AI). These innovations allow businesses to remotely monitor and control condensing units, enabling predictive maintenance, energy optimization, and troubleshooting, thereby reducing downtime and improving operational efficiency. Another trend is the development of advanced compressors and variable-speed drives, which help optimize energy consumption and provide better control over refrigeration performance. These advancements contribute to reducing energy costs and lowering the environmental impact of refrigeration systems. Also, eco-friendly refrigerants are being adopted as part of technological upgrades, with low-GWP (global warming potential) refrigerants gaining traction to comply with stricter environmental regulations. The market is also witnessing the rise of modular and compact designs, which allow for flexibility in installation and can be tailored to fit various space constraints, making them suitable for a wide range of applications, from small retail stores to large-scale industrial operations. Also, energy-efficient solutions like heat recovery systems are becoming more common, where excess heat from the refrigeration cycle is repurposed for other processes, enhancing the overall energy savings and sustainability of refrigeration systems. These technological advancements are expected to continue driving growth and innovation in the global condensing unit market.

Online & E-Commerce Sales Growth

The growth of online and e-commerce sales is becoming an increasingly important trend in the global condensing unit market. As a part of this, according to a recent study, as of August 2024, in the third quarter of 2024, online shoppers spent an average of about 2.61 U.S. dollars per visit across all verticals. Health and beauty are the category in which consumers spent the most money per visit on average, at 3.02 U.S. dollars, followed by home appliances at 2.66 dollars. As businesses and consumers alike embrace digital platforms for purchasing goods and services, the refrigeration industry is seeing a shift towards online sales channels for condensing units and related products. E-commerce platforms provide convenience, accessibility, and the ability to compare various products, prices, and features from multiple suppliers, making it easier for customers to make informed decisions. The rise of online sales is driven by the growing demand for refrigeration systems across various industries, including foodservice, retail, pharmaceuticals, and logistics. Online marketplaces, such as Alibaba, Amazon, and specialized refrigeration distributors, offer a wide range of condensing units, making it easier for businesses to access high-quality, energy-efficient, and eco-friendly solutions. Also, e-commerce growth is enabling faster and more convenient product delivery, which is crucial for industries requiring quick installation or replacement of refrigeration systems. Online platforms also facilitate the direct purchase of spare parts, replacement components, and after-sales services, ensuring the continued efficiency of refrigeration systems. As online purchasing becomes more prevalent in the condensing unit market, manufacturers are increasingly focusing on improving their digital presence, offering tailored solutions, and enhancing customer support to cater to the evolving needs of businesses around the world.

Segmental Insights

Type Insights

Air-Cooled dominated the global Condensing Unit market, due to their simplicity, cost-effectiveness, and widespread applicability. These systems use ambient air to cool the refrigerant, making them easier to install and maintain compared to water-cooled units. Their popularity is driven by their lower initial investment, energy efficiency, and the ability to operate in various environmental conditions. Air-cooled condensing units are commonly used in commercial and industrial applications, including supermarkets, food storage facilities, and HVAC systems. Also, they require less water and are more environmentally friendly, which further boosts their demand globally, especially in regions with limited water resources.

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Regional Insights

North America dominated the global Condensing Unit market, due to the region's advanced infrastructure, high demand for refrigeration systems, and strong regulatory frameworks promoting energy efficiency and sustainability. The presence of key players in the refrigeration industry, along with the growing adoption of energy-efficient and environmentally friendly condensing units, has further fuelled market growth. Also, industries such as foodservice, retail, and pharmaceuticals in North America require reliable and high-performance cooling systems, driving demand for condensing units. Government regulations and environmental initiatives supporting low-GWP refrigerants and eco-friendly practices have also played a significant role in the region’s dominance.

Recent Developments

• In August 2024, Danfoss India, a leader in sophisticated cooling solutions, launched Optyma Pack Condensing Unit, developed to revolutionize bulk milk cooling with unparalleled robustness and reliability. The Optyma Pack, introduced at Food Pro 2024, is designed to satisfy the high demands of dairy operations, providing excellent performance even under extreme conditions. The Optyma Pack has a smart twin-fan design that greatly improves cooling efficiency and system durability. This sophisticated structure ensures exceptional heat dissipation, allowing for ideal operating temperatures even in hot ambient conditions of up to 48°C. This makes the Optyma Pack appropriate for warmer areas, where cooling performance may be an issue.
• In July 2024, Panasonic Corporation announced that its Cold Chain Solutions Company (hereinafter referred to as Panasonic) has reached an agreement with Cooling Solutions S.L. to acquire all the shares of its subsidiary Area Cooling Solutions Sp. z o.o., a Polish refrigeration equipment manufacturer. Panasonic sees this deal as a strategic step toward strengthening its condensing unit business in Europe and accelerating its ongoing global expansion.
• In April 2024, Voltas launched its new commercial AC product line for commercial areas at ACREX India 2024 in Noida. The new Inverter Scroll Chillers feature chilling capacities ranging from 12-72 TR and use eco-friendly refrigerants. The product is IoT enabled, BMS compliant, silent in operation, and user-friendly, since it can be controlled via a smartphone app. With this new line of Inverter Scroll Chillers, the firm hopes to further its mission of encouraging commercial areas to adopt cutting-edge technology and incorporate energy-efficient solutions into their operations.

Key Market Players

• Emerson Electric Co
• Carrier Global Corporation
• Danfoss
• GEA Group Aktiengesellschaft
• BITZER Kühlmaschinenbau GmbH
• Baltimore Aircoil Company, Inc
• Dorin S.p.A.
• SCM Frigo S.p.A.
• Daikin Industries, Ltd
• EVAPCO, Inc.

Report Scope:

In this report, the Global Condensing Unit Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

•   Condensing Unit Market, By Type:

o   Air-Cooled

o   Water-Cooled

o   Evaporative

• Condensing Unit Market, By Function:

o   Air Conditioning

o   Refrigeration

o   Heat Pumps

• Condensing Unit Market, By Application:

o   Commercial

o   Industrial

o   Transportation

• Condensing Unit Market, By Region:

o   North America

§  United States

§  Canada

§  Mexico

o   Asia-Pacific

§  China

§  Japan

§  India

§  Australia

§  South Korea

§  Indonesia

o   Europe

§  France

§  United Kingdom

§  Italy

§  Germany

§  Spain

o   South America

§  Argentina

§  Colombia

§  Brazil

o   Middle East & Africa

§  South Africa

§  Saudi Arabia

§  UAE

§  Turkey

Competitive Landscape

Company Profiles: Detailed analysis of the major companies presents in the Global Condensing Unit Market.

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Company Information

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