Europeans have finally started rushing to buy air conditioners. For many years, this was not a topic of significant discussion. With mild summers, household air conditioner penetration in Europe has long remained below 20%. Many residential buildings, constructed decades ago, have restrictions on drilling into exterior walls. Installing fixed air conditioning units is not only subject to cumbersome approval processes but also incurs labor costs that can exceed the price of the unit itself. For global air conditioning manufacturers, Europe has always been a market that received little attention.
This summer, however, is different. Recently, countries including Germany, Denmark, and the Czech Republic have seen temperatures soar past 40°C, with France, the UK, and Switzerland also consecutively breaking high-temperature records. As the heatwave spreads, a previously unremarkable product—the portable split air conditioner—is rapidly selling out across Europe.
The Initial Wave of Demand
The companies first capitalizing on this surge in demand are not European brands, but Chinese enterprises that had strategically positioned themselves in this market segment. Several Chinese home appliance manufacturers have confirmed to reporters that European market demand this year has significantly exceeded expectations, with some products already sold out. Multiple companies have reported that their portable air conditioner inventories have been depleted.
This sales boom is not solely due to hotter weather. According to Liu Buchen, a veteran home appliance industry observer, on one hand, Europe's annual average temperature is below 10°C, with peak temperatures typically around 33°C and heatwaves not lasting very long. On the other hand, air conditioning in Europe is considered a "pre-installation" market product, meaning it must be installed during the building's construction, making retrofitting extremely difficult.
The demand exists, but the true market constraint has been installation conditions. Due to a large stock of housing built decades ago with strict limitations on exterior wall modifications, coupled with high labor installation costs, many renters also lack the incentive to install fixed units.
It is precisely within this context that portable split air conditioners have begun to open a new market in Europe. Liang Zhenpeng, a senior industrial economy analyst, explained that compared to traditional wall-mounted units, portable split air conditioners require no drilling or professional installation. This bypasses the renovation restrictions of Europe's older buildings and solves the problem for renters who cannot take fixed units when they move. Furthermore, these products generally comply with the EU's high energy efficiency standards, making them more suitable for the region's high electricity prices and energy-saving regulations.
Chinese Manufacturers Seize the Opportunity
Chinese companies, having anticipated this shift, are the first to experience an explosion in orders. A representative from Midea Group Co.,Ltd. (SHE: 000333) stated that the company's air conditioner sales in several Western European countries have grown strongly this year, achieving year-on-year increases of over 70% in markets with traditionally low penetration like France, Spain, Germany, and the UK. Currently, Midea's Shunde factory is working overtime to produce its PortaSplit portable split air conditioners, which are being transported via the China-Europe Railway Express to catch the final summer sales window.
"Portable air conditioners are mainly sold in Germany, France, and the UK. Currently, all inventory for portable air conditioners has been cleared," a relevant person in charge from TCL Air Conditioning told reporters.
"At present, Gree's plug-and-play portable air conditioners, which require no installation, are completely sold out in regional channels. Overseas distributors are urgently rushing to replenish stock and ensure market supply to meet local consumers' cooling needs," a representative from Gree Electric Appliances,Inc.Of Zhuhai (SHE: 000651) also stated.
"The company launched portable air conditioner products in Southwestern Europe this May, and post-launch sales have far exceeded expectations," said Wu Jun, head of the air conditioning division at Dreame. He added that the independent website has quickly sold out, and both Amazon and various national channels are experiencing supply shortages, with some regions completely sold out. The first batch of inventory is expected to be fully cleared by July. The company is making every effort to coordinate its global supply chain to increase production capacity.
A Potential Market Inflection Point
Industry insiders view this not merely as a simple hot-weather boom but rather as the potential beginning of the European air conditioner market truly entering a mass-consumption phase. Ding Shaojiang, chief analyst at GKURC Industry Economy Think Tank, noted that while this round of extreme heat has triggered immediate demand in the short term, factors such as the normalization of extreme high temperatures, a shift in public perception towards cooling, the gap in low penetration rates, and the suitability of portable split units for addressing long-term housing contradictions point to the start of long-term market expansion.
Liang Zhenpeng also believes that, in the long run, global warming is turning extreme heat in Europe from an occasional event into a norm. Simultaneously, countries like Spain and France are relaxing approval rules for air conditioner installation. Residents' consumption attitudes are shifting from resisting air conditioning to recognizing its necessity, so the growth potential of the European air conditioner market is continuously being unlocked.
More Than a Seasonal Trend
It is noteworthy that European local brands are scarcely visible in this wave of portable split air conditioner sales. The entities truly capturing this new demand are Chinese companies with complete supply chains and rapid delivery capabilities, along with Japanese brands that have long cultivated the European market.
The reasons behind this are related to the development path of Europe's air conditioning industry. For a long time, heating demand in Europe has far exceeded cooling demand. Local HVAC companies have focused more resources on products like boilers, wall-hung boilers, and heat pumps rather than household air conditioners.
Concurrently, many traditional European home appliance brands have gradually retreated from core air conditioning manufacturing. For example, Sweden's Electrolux still focuses its main business on major home appliances, with a relatively small air conditioning segment. Germany's Bosch, while offering air conditioning products, primarily uses cooperative production models, with its business emphasis concentrated on HVAC products like heat pumps, not positioning it as a mainstream global air conditioner manufacturer.
In terms of product competitiveness, Chinese brands, after years of accumulation, have developed strong advantages in core technologies like compressors and variable frequency control, with related products certified to meet high EU energy efficiency standards. In contrast, European local brands have relatively limited R&D accumulation in specific areas like compressors, and existing products still lag behind Chinese offerings in aspects like noise control and energy efficiency.
Liang Zhenpeng pointed out that China possesses 70% to 80% of the global air conditioning production capacity, with core components like compressors and electronic controls largely under domestic control. Industrial clusters in the Pearl River Delta and Yiwu have formed a complete upstream and downstream supporting system, enabling rapid production scale-up during urgent orders. Conversely, Europe's local home appliance industry shows significant hollowing out, with insufficient basic industrial capacity and reliance on imports for some materials, resulting in a relatively weak supply chain supporting capability that struggles to respond quickly to surging market demand.
Ding Shaojiang added that European companies have R&D cycles spanning several years, while domestic Chinese companies can localize and modify products within half a year. Large-scale manufacturing further reduces costs, allowing products with comparable energy efficiency to be priced 30% to 50% lower. He believes European local brands will find it difficult to catch up in the short term, as industrial chain hollowing and lack of flexible production capacity are hard constraints, limiting them to minor layouts in niche markets.
In fact, what Chinese companies are truly competing for is not a single, uniform market. A representative from Haier Smart Home Co.,Ltd. (SHA: 600690) stated that the company iterates and customizes models for different scenarios, such as high temperatures in Southern Europe, energy saving in Western Europe, and rental situations in Eastern Europe. It closely follows EU energy efficiency and environmental regulations, continuously launching dedicated air conditioner products suitable for old buildings and renovation projects. The representative also noted that European local brands have slower supply chain responses and insufficient production flexibility, often leading to stockouts during peak heat seasons. In contrast, Haier has integrated the entire chain from R&D, manufacturing, and channels to after-sales service, enabling it to meet European market demand more rapidly.
For Chinese air conditioning enterprises, the significance brought by this heatwave likely extends far beyond a single peak season. Financial reports from Jinhai Hi-Tech indicate that, influenced by extreme high temperatures, Europe is transitioning from a "non-air conditioning culture" to viewing air conditioning as a "necessity," with market demand showing explosive growth. The International Energy Agency predicts that by 2050, the stock of air conditioners in the EU will double from 110 million units in 2019 to 275 million units. Europe is accelerating into an "air conditioning for all" era, poised to become the global air conditioning industry's market with the greatest growth potential.
Over the past two decades, China's air conditioning industry primarily relied on domestic replacement demand and growth in emerging markets. Today, a vast market that once barely existed is gradually taking shape in Europe.
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