International. Optimism among HVAC/R manufacturers around the world about economic conditions and prospects for their own businesses has reached all-time highs, according to the latest Annual Economic Outlook Survey conducted by the AHR Expo and ASHRAE, with 89% of respondents forecasting excellent or good growth, increasing by 15% the already positive outlook in 2017.
That optimism also translated into higher sales forecasts for the industry in 2018, with 74% of respondents forecasting growth rates above 5%, a jump of 14% compared to 65% of respondents forecasting high growth in 2017.
The strong growth forecast for 2018 is even more impressive considering how robust the business was this year. In 2017, sales increased significantly (more than 10% year-on-year) for 34% of responding organizations. That's nearly 50% more than a year ago when only 23% reported sales growth above 10% above 2016 levels.
The survey indicates that the business is clearly better overall, with 69% reporting higher sales in 2017 versus 57% in 2016.
"With this overwhelmingly positive outlook for next year's HVAC/R business, more and more industry professionals will need to look for the best and newest equipment and products available to them. This makes the AHR Expo a must-attend event for those who need to keep up with the advancement of technology," said Clay Stevens, manager of AHR Expo.
Analyzing specific market segments, survey participants were the most optimistic about the residential, light commercial, office buildings, and manufacturing/industry sectors, with 70% forecasting excellent or good growth in those segments. Nearby were heavy commercial buildings, schools and institutional buildings, data/telecommunications centers, and hospitals, each of which ranked in the range of 60% to 69%. But the optimistic outlook encompassed all markets, with each of them achieving 50% or more of forecasts for excellent or good growth in 2018.
One change in the 2018 outlook is that new construction was identified as the biggest market driver, rather than maintenance/replacement, which was seen as the biggest driver in 2017. 45% of respondents cited new construction as the growth engine for 2018, 50% ahead of the 2017 survey, when only 30% saw new construction as the biggest driver.
In terms of customer requirements, reliability came first, with upfront costs and energy efficiency as finalists as the factors expected to be the most influential in their purchasing decisions for 2018. The importance of these three considerations has not changed since the 2017 survey, when they were also ranked as the highest by respondents.
