Demand for Split HVAC Systems in USA

Demand for Split HVAC Systems in USA 2025 to 2035

Demand for split HVAC systems in the USA is projected to grow from USD 12.85 billion in 2025 to approximately USD 29.43 billion by 2035, recording an absolute increase of USD 16.58 billion over the forecast period. This translates into a total growth of 129.0%, with demand forecast to expand at a compound annual growth rate (CAGR) of 8.6% between 2025 and 2035.

The overall demand is expected to grow by nearly 2.3 times during the same period, supported by increasing energy efficiency regulations and building code requirements, growing adoption of retrofit solutions in aging residential infrastructure, rising investment in smart home technology, and expanding commercial construction activity throughout the USA.

Quick Stats for USA Split HVAC Systems Industry

• USA Split HVAC Systems Sales Value (2025): USD 12.85 billion
• USA Split HVAC Systems Forecast Value (2035): USD 29.43 billion
• USA Split HVAC Systems Forecast CAGR: 8.6%
• Leading Product Type in USA Split HVAC Systems Industry: Air Conditioners (61.20%)
• Key Growth Regions in USA Split HVAC Systems Industry: West, Northeast, South, Midwest
• Regional Leadership: West holds the leading position in demand
• Key Players in USA Split HVAC Systems Industry: Carrier Global Corporation, Johnson Controls International plc, Daikin Industries Ltd., LG Electronics Inc., Panasonic Corporation, Midea Group Co., Ltd., Samsung Electronics Co., Ltd., Mitsubishi Electric Corporation, Fujitsu General Limited, Voltas Limited

The air conditioners segment is projected to account for 61.20% of split HVAC systems demand in 2025. Air conditioner applications are widely used in the USA for residential cooling activities, commercial climate control, and industrial operations where energy efficiency profiles, proven reliability characteristics, and operational versatility benefits remain essential for temperature management applications and building implementations. The retrofit/replacement segment is expected to represent 58.70% of split HVAC systems demand in 2025. Retrofit/replacement applications are fundamental to the industry because they provide the operational balance, modernization capabilities, and installation flexibility required for large-scale building upgrade developments and residential applications.

Between 2020 and 2025, split HVAC systems demand in the USA experienced steady expansion, driven by increasing energy efficiency regulation enforcement patterns and growing recognition of advanced climate control benefits for comfort optimization and cost reduction enhancement. The sector developed as building owners and residential operators, especially in major metropolitan centers, recognized the need for reliable temperature control systems and effective comfort solutions to achieve regulatory objectives while meeting energy standards and operational requirements. Construction companies and equipment suppliers began emphasizing technology integration and efficiency acceptance to maintain competitive advantages and operational viability.

Between 2025 and 2030, demand for split HVAC systems in the USA is projected to expand from USD 12.85 billion to USD 18.42 billion, resulting in a value increase of USD 5.57 billion, which represents 33.6% of the total forecast growth for the decade. This phase of growth will be shaped by accelerating building modernization campaigns, rising energy efficiency investment, and growing compliance requirements for advanced climate control systems across USA regions, particularly in areas where residential infrastructure and commercial construction initiatives are accelerating split HVAC systems adoption. Increasing integration of smart home technology in heating and cooling systems and growing adoption of IoT-enabled climate platforms continue to drive demand.

Energy authorities and building construction companies are expanding their technology capabilities to address the growing complexity of modern efficiency requirements and environmental standards, with USA operations leading investments in climate control enhancement methods and efficient temperature optimization systems.

From 2030 to 2035, demand is forecast to grow from USD 18.42 billion to USD 29.43 billion, adding another USD 11.01 billion, which constitutes 66.4% of the overall ten-year expansion. This period is expected to be characterized by expansion of advanced climate control applications, development of enhanced connectivity capabilities, and implementation of comprehensive split HVAC systems technology programs across different residential and commercial construction sectors. The growing adoption of intelligent climate systems and enhanced energy optimization platforms, particularly in major metropolitan centers and commercial operations, will drive demand for more sophisticated temperature solutions and validated efficiency systems.

USA Split HVAC Systems Industry Key Takeaways

Metric	Value
USA Split HVAC Systems Sales Value (2025)	USD 12.85 billion
USA Split HVAC Systems Forecast Value (2035)	USD 29.43 billion
USA Split HVAC Systems Forecast CAGR (2025-2035)	8.6%

Why is the USA Split HVAC Systems Industry Growing?

The USA split HVAC systems industry is driven by a surge in the broader building construction infrastructure sector. A considerable growth in demand for both energy-efficient climate solutions and building code compliance equipment has created a larger base of contractors, property owners, and construction professionals requiring reliable split HVAC systems products. Furthermore, changing regulatory patterns mandate the use of efficient climate control systems for optimal energy performance and comfort optimization.

This compliance-driven demand establishes a consistent, regulation-based foundation. As new operators enter the building construction infrastructure segment and existing residential practices are modernized, the need for standard-issue and specialized split HVAC systems products forms a stable foundation for the industry's growth, ensuring a continuous stream of customers driven by regulatory necessity and energy compliance.

Technological innovation serves as a powerful secondary engine for this growth. Modern split HVAC systems are no longer just basic temperature equipment; they are advanced climate products. The rapid adoption of specialized inverter technologies has become a major selling point, significantly reducing energy consumption and enhancing operational reliability.

Beyond traditional options, manufacturers are integrating advanced connectivity systems for seamless incorporation with digitally conscious home approaches, and compatibility with various building requirements. These features, coupled with improvements in energy efficiency, system convenience, and equipment quality, are compelling both residential and commercial operators to upgrade from basic central systems, driving a cycle of replacement and premiumization within the industry.

An increasing emphasis on climate efficiency, particularly exploration of advanced energy-saving technologies, is pushing demand for higher-quality, more diverse split HVAC systems varieties. The segment has also expanded beyond traditional residential channels, with growing interest from the commercial sector, healthcare applications, and even specialty manufacturing units.

This diversification, combined with the rise of specialized platforms that improve accessibility for all operators, ensures that manufacturers can reach a wider audience than ever before. This confluence of efficiency, innovation, and accessibility creates a fertile ground for continued industry expansion.

Segmental Analysis

The industry is segmented by product type, installation, end use, and region. By product type, the industry is divided into air conditioners and heat pumps. In terms of installation, the industry is segmented into retrofit/replacement and new installation, with air conditioners representing a key growth and innovation hub for climate technologies. By end use, the industry is categorized into residential and commercial. Regionally, the industry is divided into West, Northeast, South, and Midwest.

Which Product Type enjoys the Dominant Share in the HVAC Systems Industry in USA?

Air conditioners are projected to account for 61.20% of split HVAC systems demand in 2025, making it the leading product type across the sector. This dominance reflects the cooling requirements and operational acceptance needs of climate systems for existing residential facilities and commercial applications where energy efficiency is optimized through proven reliability characteristics and integrated design architecture.

In the USA, where substantial building infrastructure requires temperature control integration without complete system redesign, air conditioner split HVAC solutions provide practical pathways for comfort enhancement while maintaining operational preferences. Continuous innovations are improving efficiency optimization, reliability preservation, and versatility parameters, enabling building operators to achieve high performance standards while maximizing operational satisfaction.

• Cooling compatibility and existing system integration make air conditioners the preferred product type for enhancing residential facilities and commercial operations.
• Reliability demonstration and performance track records are enhancing operator confidence and equipment viability across large-scale adoption initiatives.

By Installation, Which Category Captures the Dominant Share in USA?

Retrofit/replacement applications are expected to represent 58.70% of split HVAC systems demand in 2025, reflecting the critical role of building modernization requiring comprehensive climate solutions. Retrofit/replacement operations including residential projects, commercial facilities, and industrial systems generate consistent demand for split HVAC systems that support efficient operational utilization and performance optimization.

Split HVAC systems are widely adopted for retrofit/replacement facilities due to significant installation efficiency benefits and enhanced operational capabilities. Their reliable, high-performance operation provides effective, cost-efficient climate solutions, enhancing operational independence for retrofit/replacement users.

• Building modernization requirements and retrofit/replacement operations drive substantial demand for specialized split HVAC systems designed for residential applications.
• Operational optimization and performance efficiency demands create consistent climate requirements across major residential regions and commercial facilities.

What are the Drivers, Restraints, and Key Trends in the USA Split HVAC Systems Industry?

The demand for split HVAC systems in the USA is advancing steadily due to increasing compliance requirements and growing recognition of advanced energy-efficient necessity for environmental protection, with the West region serving as a key driver of innovation and building modernization.

The sector faces challenges including initial cost considerations, installation complexity with existing infrastructure, and ongoing concerns regarding maintenance requirements and specialized technical support.

Growth in Building Infrastructure Development and Energy Enhancement Programs

The enhancement of energy standards, gaining particular significance through regulatory trends and efficiency education campaigns, is enabling split HVAC systems providers to achieve differentiation without prohibitive production costs, providing predictable demand patterns through compliance requirements and operator preferences.

Enhanced energy standards offering substantial opportunities for split HVAC systems and integrated applications provide foundational dynamics while allowing providers to secure building facility agreements and distribution partnerships.

Incorporation of Advanced Connectivity Capabilities and High-Precision Climate Systems

Modern split HVAC systems providers and building operators are establishing advanced manufacturing networks and centralized production facilities that improve manufacturing efficiency through process standardization and performance analytics.

Integration of connectivity enhancement systems, high-precision inverter technology, and coordinated quality management enables more efficient production operations across multiple manufacturing regions.

Creation of Automated Climate Systems and Enhanced Efficiency Targeting Methods

The expansion of automated climate systems and efficiency segmentation is driving development of specialized split HVAC systems with enhanced energy profiles, improved reliability characteristics, and optimized performance attributes that address current limitations and expand climate applications beyond traditional central systems.

These specialized systems require sophisticated connectivity capabilities and performance expertise that exceed traditional manufacturing requirements, creating specialized demand segments with differentiated equipment propositions. Producers are investing in efficiency targeting and performance optimization to serve emerging building applications while supporting innovation in technology development and operator engagement.

Analysis of USA Split HVAC Systems Demand by Key Regions

Region	CAGR (2025 to 2035)
West	8.90%
Northeast	8.40%
South	8.20%
Midwest	8.00%

The USA split HVAC systems demand is witnessing steady growth, supported by rising compliance requirements, expanding building facility initiatives, and the deployment of advanced climate technologies across regions. West leads the nation with an 8.90% CAGR, reflecting a strong residential construction base, substantial commercial development, and established technology innovation facilities.

West Leads National Growth with Residential Construction and Commercial Applications

Demand for split HVAC systems in West is projected to exhibit strong growth with a CAGR of 8.90% through 2035, driven by a strong residential construction base, substantial commercial development creating advanced climate opportunities, and a concentration of innovation advancement across California, Oregon, Washington, Nevada, and surrounding states.

Advanced efficiency programs and energy control initiatives are expanding split HVAC systems adoption among contractors, residential facilities, and commercial suppliers pursuing compliance optimization, energy development, and specialized construction projects throughout major urban hubs and residential corridors.

• Residential construction base and commercial infrastructure capabilities are requiring comprehensive climate strategies and temperature solutions, driving demand for split HVAC systems with demonstrated energy enhancement performance capabilities and permanent efficiency assurance throughout diverse building operations.
• Commercial development and construction concentration are generating substantial split HVAC systems demand across residential companies, contractors, and efficiency suppliers serving building applications and compliance requirements.

Northeast Demonstrates Strong Growth with Established Residential Excellence

Demand for split HVAC systems in Northeast is projected to grow with a CAGR of 8.40% through 2035, supported by established residential presence, comprehensive commercial development, and strong construction facilities across New York, Pennsylvania, Massachusetts, New Jersey, and surrounding states.

Established residential presence and construction leadership are supporting split HVAC systems adoption throughout contractor facilities, building operations, and efficiency distribution centers serving compliance enhancement and construction applications.

• Strong residential ecosystem and construction networks are enabling split HVAC systems integration across efficiency producers, contractors, and climate suppliers pursuing advanced compliance development and energy programs.
• Premium commercial capabilities and residential excellence are driving split HVAC systems demand among leading contractor corporations, efficiency centers, and specialized residential firms focused on performance enhancement, climate optimization, and construction development targeting compliance applications and advanced building operations.

South Shows Steady Growth with Expanding Commercial Capabilities

Demand for split HVAC systems in South is forecast to advance with a CAGR of 8.20% through 2035, driven by expanding commercial capabilities, growing residential investment, and increasing efficiency consciousness across Texas, Florida, Georgia, North Carolina, and surrounding states.

Rising residential sector development and construction partnerships are supporting split HVAC systems integration across climate producers, contractor facilities, and efficiency distributors pursuing compliance enhancement, commercial expansion, and energy initiatives throughout expanding residential regions and urban centers.

• Growing commercial infrastructure and residential investment are creating opportunities for split HVAC systems adoption across emerging climate hubs, contractor facilities, and efficiency distribution centers in major metropolitan areas and residential corridors.
• Commercial expansion and efficiency growth are driving split HVAC systems demand among residential operators seeking enhanced performance capabilities and participation in advanced climate programs.

Midwest Records Consistent Growth with Construction Leadership

Demand for split HVAC systems in Midwest is expected to expand with a CAGR of 8.00% through 2035, supported by construction capabilities, commercial infrastructure development, and growing contractor efficiency presence across Illinois, Ohio, Wisconsin, Michigan, and surrounding states.

Commercial expertise and production capabilities are driving split HVAC systems demand among residential producers, efficiency suppliers, and construction companies serving climate production and building applications.

• Growing construction development and commercial investment are supporting split HVAC systems adoption across emerging production hubs, residential facilities, and contractor centers pursuing performance enhancement and climate programs.
• Expanding commercial infrastructure and construction integration are creating opportunities for split HVAC systems utilization across efficiency suppliers, residential production facilities, and contractor operations seeking building climate production, efficiency support, and construction capabilities throughout major commercial regions and emerging contractor residential centers.

Competitive Landscape of USA Split HVAC Systems Industry

The split HVAC systems industry in USA is defined by competition among established commercial corporations, specialized climate companies, and integrated efficiency producers, with major contractor operators maintaining significant influence through production resources and construction capabilities. Companies are investing in climate advancement, temperature optimization, energy-efficient acceptance technologies, and comprehensive performance services to deliver effective, reliable, and efficient energy solutions across USA residential and contractor applications.

Carrier Global Corporation dominates with an 18.70% share, offering comprehensive energy-efficient climate solutions including advanced equipment, performance enhancement technologies, and distribution services with a focus on residential applications, efficiency consistency, and temperature optimization across USA operations. The company continues investing in climate programs, distribution strategies, and split HVAC systems innovation while expanding operational presence and advanced contractor applications.

Johnson Controls International plc provides specialized climate solutions with emphasis on performance development and construction excellence. Daikin Industries Ltd. focuses on premium temperature development and residential applications. LG Electronics Inc. emphasizes commercial development and specialized contractor equipment production. Panasonic Corporation offers climate technology solutions and professional performance support. Midea Group Co., Ltd. specializes in residential temperature development and distribution programs.

USA Split HVAC Systems Industry - Stakeholder Contribution Framework

The USA split HVAC systems industry is a critical backbone for national energy optimization, supporting building installations, contractor infrastructure, and residential applications. With a projected demand value driven by commercial development, residential equipment adoption cycles, and climate technology advancement, the sector's resilience depends on collaborative engagement among government agencies, contractor operators, climate companies, and investors to modernize infrastructure, enhance efficiency, and secure supply chains.

How Governments Could Accelerate Infrastructure Modernization and Industry Competitiveness?

• Federal Energy Infrastructure Grants: Expand funding through the Department of Energy and Environmental Protection Agency for R&D into advanced climate materials, efficiency-enhanced technologies, and connectivity systems to enhance performance and longevity.
• Tax Incentives for Equipment Installation: Offer investment tax credits for operators replacing conventional systems with high-efficiency split HVAC systems, inverter systems, or smart energy systems that reduce energy consumption and operational costs.
• Domestic Manufacturing and Production Support: Implement policies and strategic reserves for domestic climate production, ensuring a resilient supply of raw materials and mitigating import dependency and price volatility.
• Standardized Energy and Certification Policies: Introduce unified federal standards for split HVAC systems manufacturing, performance testing, and installation inspection to streamline regulatory approval and boost interoperability.
• Permitting Process Reform: Expedite environmental reviews and permitting for critical climate projects that enhance national energy grid efficiency and building capacity.
• Digital Connectivity Mandates: Promote the deployment of smart sensors, wireless connectivity, and remote monitoring technologies as part of climate management protocols.

How Industry Bodies & Associations Could Strengthen Sector Coordination and Technical Leadership?

• Unified Material and Energy Standards: Develop consensus-based benchmarks for climate grades, energy ratings, and performance standards to ensure interoperability and system-wide efficiency.
• Workforce Development Programs: Create certification pathways for climate technicians, energy installers, and building engineers to address the skilled labor shortage and ensure quality installation.
• Collaborative R&D Consortia: Establish joint programs linking operators, manufacturers, and research institutions to drive innovation in energy-detection technologies, advanced materials, and connectivity systems.
• Performance Data Repositories: Build centralized industry databases for performance incident data, efficiency rates, and material performance to inform better design and maintenance standards.
• Public Outreach and Awareness: Promote the role of modern climate infrastructure in energy reliability, economic growth, and environmental protection through coordinated industry campaigns.

How Split HVAC Systems Manufacturers & Technology Suppliers Could Capture Value and Drive Innovation?

• Advanced Climate Manufacturing: Invest in production technologies for high-grade inverter systems, efficiency-enhanced equipment, and smart energy solutions for demanding applications.
• Energy Connectivity System Integration: Develop integrated diagnostic platforms combining smart sensor data, wireless monitoring, and performance analytics for predictive maintenance.
• Supply Chain Digitalization: Implement digital traceability from component sourcing to final installation, using blockchain or QR codes to ensure material provenance and quality compliance.
• Partnership with Research Institutions: Collaborate with national labs on next-generation materials, such as advanced climate technologies and composite energy systems for high-performance applications.
• Commercial Optimization: Introduce automated manufacturing systems, advanced inverter applications, and modular equipment fabrication to lower manufacturing costs and improve throughput.

How Contractor Operators & Infrastructure Companies Could Optimize Building Efficiency and Demand Expansion?

• Digital Asset Integration: Create digital replicas of climate assets integrated with real-time sensor data to optimize performance, predict maintenance, and simulate efficiency scenarios.
• Scale-up of High-Value Applications: Focus on climate specifications for building developments, high-efficiency energy projects, and residential transportation networks.
• Collaborative Supply Ecosystems: Develop long-term contracts with equipment manufacturers and technology suppliers to ensure consistent quality and secure capacity during expansion cycles.
• Pilot-to-Field Deployment Transition: Use phased testing for new climate technologies, such as advanced inverter systems for contractor service, before full-scale field deployment.
• Lifecycle Cost Optimization: Invest in premium climate materials and technologies during installation to reduce long-term maintenance and operational expenses.

How Residential & Service Companies Could Lead Cross-Sector Integration?

• Contractor and Utility Integration: Deploy advanced monitoring and optimization technologies for aging distribution networks in urban and building areas.
• Facility and Asset Enhancement: Incorporate real-time energy management platforms that combine performance data with efficiency assessment for a comprehensive view of asset health.
• Distribution and Grid System Management: Apply advanced efficiency-based methodologies to prioritize maintenance on vast and often complex climate networks.
• Regional Testing and Validation Hubs: Create regional facilities to test and validate new monitoring tools, efficiency technologies, and climate systems under simulated field conditions.
• Climate Life Extension Initiatives: Reuse and upgrade equipment segments for enhanced efficiency services and optimize rehabilitation programs through advanced technology and smart management systems.

How Engineering & Construction Firms Could Unlock Application Innovation and Demand Access?

• Design and Material Expansion: Develop customized climate solutions for challenging environments, including urban conditions, weather zones, and high-efficiency applications.
• Modular Energy Applications: Integrate prefabricated and pre-optimized climate systems into facility design to reduce field installation time and costs.
• Advanced Project Delivery Systems: Offer integrated EPC (Engineering, Procurement, and Construction) platforms that include digital as-built handover with all climate material records.
• Design for Building Services: Partner with operators to provide co-engineered climate systems optimized for constructability, operability, and long-term efficiency.
• Digital Platform Development: Launch project management platforms for standardized equipment components, procurement tracking, and quality assurance documentation.

How Investors and Financial Enablers Could Unlock Growth and Technology Scalability?

• Venture Capital for Technology Startups: Support early-stage companies developing novel monitoring systems, efficiency-based detection, and AI-driven energy software.
• Infrastructure and Modernization Financing: Provide capital for climate replacement programs, contractor facility upgrades, and digital control system installations.
• Public-Private Investment Platforms: Create co-financed funds for pilot projects demonstrating building efficiency or infrastructure transportation in enhanced or new-built climate systems.
• Strategic Consolidation Funding: Back mergers and acquisitions that consolidate fragmented climate technology, service, or manufacturing companies to achieve scale and geographic reach.
• Performance-Linked Financing Models: Tie loan terms and investor returns to key performance indicators like reduced energy consumption, improved efficiency records, and enhanced building performance.
• Residential Transition Financing Programs: Channel innovation-oriented funds into climate systems dedicated to building efficiency, residential development, and energy efficiency networks.

Key Players in USA Split HVAC Systems Industry

• Carrier Global Corporation
• Johnson Controls International plc
• Daikin Industries Ltd.
• LG Electronics Inc.
• Panasonic Corporation
• Midea Group Co., Ltd.
• Samsung Electronics Co., Ltd.
• Mitsubishi Electric Corporation
• Fujitsu General Limited
• Voltas Limited
• Trane Technologies plc
• Lennox International Inc.
• Goodman Manufacturing Company, L.P.
• Rheem Manufacturing Company
• American Standard Heating & Air Conditioning

Scope of the Report

Item	Value
Quantitative Units	USD 29.43 billion
Product Type	Air Conditioners, Heat Pumps
Installation	Retrofit/Replacement, New Installation
End Use	Residential, Commercial
Regions Covered	West, Northeast, South, Midwest
Key Companies Profiled	Carrier Global Corporation, Johnson Controls International plc, Daikin Industries Ltd., LG Electronics Inc., Panasonic Corporation, Midea Group Co., Ltd., Samsung Electronics Co., Ltd., Mitsubishi Electric Corporation, Fujitsu General Limited, Voltas Limited, Trane Technologies plc, Lennox International Inc., Goodman Manufacturing Company, L.P., Rheem Manufacturing Company, American Standard Heating & Air Conditioning
Additional Attributes	Sales by product type and installation segment, regional demand trends across West, Northeast, South, and Midwest, competitive landscape with established commercial corporations and climate suppliers, contractor facility preferences for air conditioners versus heat pump equipment, integration with residential facilities and advanced climate optimization policies particularly advanced in West region

USA Split HVAC Systems Industry by Segments

• Product Type :

  • Air Conditioners
  • Heat Pumps

• Installation :

  • Retrofit/Replacement
  • New Installation

• End Use :

  • Residential
  • Commercial

• Region :

  • West
  • Northeast
  • South
  • Midwest