In recent years, the central air-conditioning market has experienced multiple price hikes, but the most significant and noticeable increase occurred in 2017. By the end of that year, major brands had officially announced price adjustments. What made this round different was that some manufacturers raised prices in several consecutive rounds, especially for home central air-conditioning systems, with increases ranging from 3% to 15%. With rising costs across the board, it's clear that further price increases are likely to continue spreading throughout the industry.
Looking at the raw material situation in 2017, it was one of the most dramatic and unexpected periods in history. Prices of copper, aluminum, and steel all surged significantly, along with packaging materials and logistics costs. Even refrigerants saw a shocking increase, with some months recording over 50% price jumps. In addition, strict environmental regulations led to production halts and factory shutdowns, creating supply shortages and driving up demand. At the same time, new transportation rules reduced vehicle loading capacities, increasing freight costs by more than 30%. These factors pushed the central air-conditioning market from quiet stability to an undercurrent of change, eventually leading to new pricing strategies.
Competition in the central air-conditioning market intensified in 2017. Both the project and residential segments became highly competitive. Price wars were common in engineering projects, but as costs rose, companies found themselves in a difficult position. Meanwhile, the home improvement retail sector remained a key battleground for brand competition. Some manufacturers feared that aggressive price hikes could hurt sales, so they adjusted their strategies differently. While some companies quickly implemented price increases, others delayed or communicated verbally to dealers without setting a fixed date. The pressure from rising material costs and component shortages is expected to persist, making price increases a necessary response.
From the channel perspective, price hikes in central air-conditioning products seem inevitable. Engineering firms reported that if price changes spread or varied between brands, it could affect the project market. Low profit margins, long construction periods, and slow payments are major challenges. If manufacturers pass on cost pressures, some engineering companies may face losses just to stay afloat. In contrast, home central air-conditioning dealers are more active. Most online brands have already raised prices, but the impact on the retail level will take time to show, especially around year-end. Some dealers are exploring new service models, offering different installation options and pricing structures to give consumers more choice.
Interestingly, consumer sensitivity to price has been gradually decreasing. A survey by Aiken Air Conditioning and Refrigeration Network showed that as buyers become more informed about central air-conditioning systems, factors like design, company reputation, and after-sales service are now more important than price alone. As such, reasonable price increases are becoming more acceptable.
There’s no need to overreact or panic about these price changes. In fact, this trend can be seen as a double-edged sword. While the market continues to grow, profit margins are shrinking. A reasonable price adjustment helps companies restructure their products and improve their offerings. It also promotes healthier development within the distribution network. On one hand, tighter margins will make marketing more challenging, pushing businesses to enhance their strategies. On the other hand, it encourages positive changes in the channel, ultimately leading to a more sustainable and mature market.
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