Australia Air Conditioner Market Outlook Report - Market Size, Share Analysis and Forecast (2025-2034)

Australia Air Conditioner Market Trends

The Australia air conditioner market is expanding due to the country’s hot climate, particularly during summer, which drives demand across residential, commercial, and industrial sectors. Increased urbanisation has led more people to seek air-conditioned spaces for comfort, while higher disposable income allows Australians to invest in advanced systems. Technological innovations in energy-efficient and smart air conditioners further enhance market appeal. In March 2023, Fujitsu General Australia partnered with Nube iO to enhance smart air conditioning by integrating IoT technology. Nube iO will develop IoT control devices for Fujitsu’s anywAiR iO brand, enabling app-based and voice-controlled systems for greater indoor comfort and efficiency. 

Modern air conditioners are more energy-efficient, helping to lower electricity costs and promote environmental sustainability, impacting the Australia air conditioner market revenue. Government incentives offering rebates for energy-efficient appliances encourage broader adoption, while the growth of residential, commercial, and industrial construction drives increased demand for cooling systems.

Australia Air Conditioner Market Growth

Air conditioning provides health benefits by regulating temperature and humidity, reducing the risk of heatstroke and dehydration, which is driving demand of the Australia air conditioner market. It enhances comfort in homes, offices, and public spaces, especially during extreme weather. The rise in remote work has increased the need for comfortable home office environments, while the expanding retail and hospitality sectors further fuel demand for air conditioning solutions. Daikin was named Australia's most reliable air conditioner brand at the 2024 Finder Retail Awards, with a perfect trust score of 100%. Their air purifiers and split systems are approved by the National Asthma Council Australia’s Sensitive Choice® for improved air quality. 

The growth of the Australia air conditioner market is also supported by the rising popularity of sustainable, eco-friendly air conditioners with lower emissions, attracting environmentally conscious consumers. The integration of smart technologies, such as remote control and home automation, is further enhancing convenience.

Australia Air Conditioner Market Insights

• According to the Australian Bureau of Statistics, the value of non-residential buildings increased by 12.4%, reaching USD 4.92 billion in January 2024, compared to December 2023. This growth reflects a strong demand for commercial infrastructure, boosting construction opportunities and economic activity in the non-residential sector. 
• Industry reports indicate that Australia's building and construction sector manages over USD 162 billion worth of projects annually, contributing approximately 10% to the nation's GDP. This makes it the fifth-largest sector in the Australian economy, driving significant employment, investment, and economic growth. 
• The Australian Bureau of Statistics reports a 19.4% rise in the value of new residential construction, reaching USD 7.14 billion in January 2024. This surge highlights a robust housing market and increased demand for residential properties, benefiting both builders and suppliers in the construction industry. 

Australia Air Conditioner Market Drivers

Energy Efficiency and Sustainability

The Australia air conditioner market is experiencing significant growth due to a shift towards energy-efficient models driven by increasing environmental concerns. Both consumers and businesses are favouring systems that consume less power without compromising performance. Innovations like inverter technology and eco-friendly refrigerants are gaining popularity, reducing energy costs and environmental impact. In December 2024, Australian start-up Conry Tech began trials for its energy-efficient Bull Ant air conditioning technology, aiming to cut emissions and energy use by 40% in commercial buildings. Funded by USD 8.7 million, the trials took place at the University of New South Wales and in Melbourne, with plans for wider deployment in the coming year. 

Smart Air Conditioning Systems

The integration of smart technology into air conditioning systems is a growing trend in the Australia air conditioner market. Air conditioners that can be controlled through mobile apps or voice commands are becoming increasingly popular. These systems offer greater control, convenience, and energy savings, boosting demand for more advanced solutions in both residential and commercial spaces. In October 2024, MyPlace launched a national campaign for MyPlaceIQ’s Super Smart Air-Conditioning, featuring animated cats and dogs. The campaign highlighted the benefits of comfort, control, and energy efficiency, aiming to raise brand awareness and reduce energy consumption in Australian households. 

Opportunities in the Australia Air Conditioner Market

As temperatures rise in Australia, portable air conditioners have become increasingly popular, influencing the Australia air conditioner market dynamics and trends. These systems offer flexible, affordable cooling without permanent installation, making them ideal for renters or those seeking temporary solutions, particularly in smaller homes and apartments. In September 2024, Morphy Richards launched the world’s first ductless portable air conditioner, featuring Cooling Max Technology for efficient, long-distance cooling without the need for traditional ducts. Its innovative design provides 360° airflow, portability, energy efficiency, and powerful cooling, making it perfect for shared spaces and eco-conscious consumers.

Market Restraints

The Australia air conditioner market faces several constraints, including high initial costs for energy-efficient systems, making them unaffordable for some consumers. Despite energy-efficient advances, high electricity costs still make air conditioners expensive to operate. 

Environmental concerns over refrigerant use and space limitations in urban areas also restrict growth. Additionally, maintenance costs, technological complexity, climate variability, and market saturation in certain regions further hinder expansion. These challenges require innovation and adaptation from businesses to maintain growth in the market.

Market Breakup by Region

• New South Wales
• Victoria
• Queensland
• Australian Capital Territory
• Western Australia
• Others

Australia Air Conditioner Market Share

Market Breakup by Technology

According to the Australia air conditioner market analysis, automatic air conditioning systems dominate the market due to their convenience, adjusting temperature, humidity, and airflow without manual input. These systems maintain consistent comfort, adapt to environmental changes, and optimise energy efficiency. Featuring smart sensors and timers, they reduce energy consumption and provide efficient cooling or heating, making them ideal for Australian homes. The Hitachi airHome 600 Wall Mounted Inverter AC offers smart automation, including Wi-Fi control, location-based adjustments, and energy-saving features. It lowers energy bills, enhances sleep quality, and ensures long-term performance with self-maintenance technology, FrostWash, and Mould Guard for consistent, effective cooling. 

Manual air conditioning systems in Australia give users more control over temperature settings, allowing personalised comfort and driving demand of the Australia air conditioner market. These units are often more affordable initially and simple to operate. While requiring manual adjustments, they offer flexibility for those who prefer hands-on control over their cooling or heating needs.

Market Breakup by End Use

According to the Australia air conditioner market report, residential air conditioners dominate the market, providing essential comfort and temperature control for homes in the country’s hot climate. These systems improve energy efficiency through modern inverter technology, leading to long-term cost savings. They also enhance indoor air quality and operate quietly, making them ideal for families seeking improved home comfort and energy conservation.

Opportunities in the Australia air conditioner market are growing as commercial air conditioner businesses gain from dependable climate control in offices, retail environments, and industrial spaces. Advanced systems help boost productivity by ensuring a comfortable work environment, while energy-efficient models reduce operational expenses. Additionally, many commercial systems come with smart features such as zoning and remote management, optimising both energy usage and employee comfort.

Market Breakup by Distribution Channel

The growth of the Australia air conditioner market is driven by multi-brand stores that provide a broad range of air conditioning options from various manufacturers, allowing consumers to compare features, prices, and performance in one place. These stores offer expert advice, after-sales support, and the advantage of viewing multiple models in person, helping buyers make informed choices based on their needs and budget. According to the ABS, retail trade in Australia rose by 2.3% from July 2023 to July 2024, totalling USD 36,160.1 million in July 2024. 

Electronic stores focus on air conditioners alongside other home appliances, offering customers a wide selection of well-known brands. These stores provide hands-on experiences, detailed product demonstrations, and immediate purchase options. They often also offer installation services, warranties, and financing options, making them a comprehensive solution for both product selection and customer service.

Online channels offer the convenience of shopping for air conditioners from home, impacting the Australia air conditioner market revenue. These platforms feature a wide array of brands and models, often at competitive prices, along with customer reviews and detailed product information. Free delivery and flexible return policies enhance their appeal, while advanced filtering options help customers easily find the ideal unit for their needs. According to the ITA, e-commerce represented 18% of total Australian retail spending in 2022, reaching USD 45 billion, a slight increase from 2021. 

Australia Air Conditioner Market Regional Insights

New South Wales Air Conditioner Market Overview

The air conditioner market in New South Wales benefits from strong demand, driven by hot summers, urbanisation, and increased construction. Energy-efficient systems and technological advancements also play a key role in market expansion. In 2021, warehouse building approvals made up 73% of industrial approvals, valued at USD 2.1 billion, according to the NSW Government. 

Queensland Air Conditioner Market Trends

Queensland’s air conditioner market is growing due to its tropical climate, high residential demand, and increasing commercial use. Consumers are increasingly opting for energy-efficient, smart systems, reflecting trends towards sustainability and comfort. In Q1 2024, there was a 3.5% rise in detached house construction, as reported by the Housing Industry Association (HIA). 

Western Australia Air Conditioner Market Dynamics

Western Australia’s air conditioner market is expanding due to rising temperatures and urban development. Consumers are focusing on energy efficiency and compact systems, with a shift towards inverter-driven models for improved performance and savings. In 2023, the state recorded 40,293-unit commencements, reflecting adjustments to market conditions, according to the Australian Bureau of Statistics (ABS).

Competitive Landscape

The Australia air conditioner market key players operate across diverse industries, including electronics, chemicals, and telecommunications. They are recognised for their innovative products, such as televisions, home appliances, and air conditioning systems, and have a significant global presence. These companies specialise in offering energy-efficient and sustainable cooling and heating solutions for residential, commercial, and industrial applications.

Key Industry Players

LG Corporation: Headquartered in Seoul, South Korea, LG Corporation was established in 1947. It is a multinational conglomerate that operates in various industries, including electronics, chemicals, and telecommunications. LG is known for its innovative products such as televisions, home appliances, and air conditioning systems, with a strong global presence.

Fisher & Paykel Australia Pty Ltd.: Fisher & Paykel Australia, established in 1934, is a subsidiary of the global appliance manufacturer, Fisher & Paykel. Headquartered in Melbourne, Australia, the company is renowned for designing innovative kitchen and laundry appliances, including refrigerators, washing machines, and dryers, known for their unique design and advanced technology.

Daikin Australia Pty Ltd.: Daikin Australia, established in 1969 and headquartered in Sydney, Australia, is a subsidiary of Daikin Industries, a leading global manufacturer of air conditioning and refrigeration systems. Daikin Australia specialises in providing energy-efficient and sustainable cooling and heating solutions for residential, commercial, and industrial applications.

AHIC (Australia) Pty Ltd.: AHIC (Australia) Pty Ltd., established in 1994, is an Australian-based company that offers comprehensive heating, ventilation, and air conditioning (HVAC) services. The company provides design, installation, and maintenance solutions for both residential and commercial customers, focusing on high-quality, reliable climate control systems across various industries.

Another key player in the Australia air conditioner market report is Panasonic Australia Pty Limited, among others.

Recent Developments

June 2024

Hitachi Air Conditioning unveiled new HVAC solutions for Australia and New Zealand at ARBS 2024. The air365 Max Pro, SideSmart™, and airCore 700 models feature low-carbon, energy-efficient technologies. These products aim to improve efficiency, reduce emissions, and support Australia's climate goals, offering advanced clean air and sustainability-focused designs. 

April 2024

Mitsubishi Heavy Industries Thermal Systems launched the KXZ3 Series of building-use multi-split air conditioners, adopting R32 refrigerant. The new models, offering 22.4kW to 33.5kW capacities, improve energy efficiency by 18% and reduce environmental impact. The series was first introduced in Europe, followed by Australia, New Zealand, and Turkey.