Table of Contents

Executive Summary

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TABLE OF CONTENTS

1. INTRODUCTION 6

2. SUMMARY 7

2.1 OVERALL MARKET 7

2.2 VENTILATION 9

2.3 AIR CONDITIONING 9

2.4 NON-DOMESTIC HEATING 10

2.5 HEATING & VENTILATING ACCESSORIES 12

3. ECONOMIC ENVIRONMENT 13

3.1 INTEREST RATES 13

3.2 INFLATION 13

3.3 PUBLIC SPENDING, TAXATION AND UNEMPLOYMENT 14

3.4 CONSTRUCTION 15

4. VENTILATION 16

4.1 DEFINITION 16

4.2 MARKET SIZE 16

4.3 PRODUCTS 22

4.4 COMPANIES AND SHARES 34

4.5 DISTRIBUTION 41

5. AIR CONDITIONING 44

5.1 DEFINITION 44

5.2 MARKET SIZE 45

5.3 PRODUCTS 49

5.5 IMPORTS AND EXPORTS 61

5.6 SUPPLIERS 63

5.7 DISTRIBUTION 69

6. NON-DOMESTIC SPACE HEATING 72

6.1 DEFINITION 72

6.2 MARKET SIZE 72

6.3 PRODUCTS 75

6.4 SUPPLIERS AND SHARES 88

6.5 DISTRIBUTION 96

7. ACCESSORIES 99

7.1 DEFINITION 99

7.2 MARKET 99

7.3 PRODUCTS 102

8. KEY MARKET INFLUENCES 113

8.1 CONTRACTORS OUTPUT - INDUSTRIAL AND COMMERCIAL 113

8.2 THE HOUSING MARKET 116

8.3 PERSONAL DISPOSABLE INCOME 119

8.4 POPULATION FIGURES 121

9. FUTURE PROSPECTS 123

9.1 ECONOMIC OUTLOOK 123

9.2 VENTILATION 124

9.3 AIR CONDITIONING 124

9.4 NON-DOMESTIC HEATING 125

9.5 ACCESSORIES 126

LIST OF TABLES AND CHARTS

CHART 1: OVERALL MARKET FOR VENTILATION, AIR CONDITIONING AND NON DOMESTIC HEATING

CHART 2: MIX OF OVERALL MARKET BY PRODUCT GROUP - VALUE 1995

TABLE 3: MIX FOR NON DOMESTIC HEATING SALES BY VALUE 1995

TABLE 4: UK MARKET SIZE FOR VENTILATION PRODUCTS 1998 - 2000

CHART 5: VENTILATION MARKET IN CONSTANT 1990 PRICES

TABLE 6: VENTILATION MARKET BY PRODUCT TYPE 1995

TABLE 7: THE UK MARKET FOR COOKER HOODS £M MSP

TABLE 8: MARKET SHARES OF UK FAN SUPPLIERS 1995 BY VALUE

TABLE 9: MARKET SHARES OF UK NON-DOMESTIC AXIAL SUPPLIERS 1995 percent BY VALUE

TABLE 10: MARKET SHARES OF UK DOMESTIC EXTRACTOR SUPPLIERS 1995 percent BY VALUE

TABLE 11: MARKET SHARES OF CENTRIFUGAL FAN SUPPLIERS 1995 BY VALUE

CHART 12: VENTILATION MARKET - DISTRIBUTION 1995 BY VALUE

TABLE 13: THE UK AIR CONDITIONING MARKET 1988-2000

CHART 14: THE UK AIR CONDITIONING MARKET AT CONSTANT 1990 PRICES £M

CHART 15: MIX OF AIR CONDITIONING SYSTEMS BY VALUE 1993 AND 1995

TABLE 16: UK PACKAGED AIR CONDITIONING MARKET 1989-2000

CHART 17: MIX OF PAC SYSTEM SALES BY VALUE 1995

TABLE 18: THE UK CENTRAL STATION AIR CONDITIONING MARKET 1988 - 2000

CHART 19: MIX OF CENTRAL SYSTEM PRODUCTS BY VALUE - 1995

CHART 20: MIX OF TERMINAL UNITS SALES 1990 AND 1995 BY VALUE £M MSP

TABLE 21: IMPORTS AND EXPORTS OF AIR CONDITIONING PRODUCTS 1994 AND 1995

TABLE 22: MARKET SHARE IN THE PAC SYSTEM MARKET BY VALUE - 1995

TABLE 23: MARKET SHARE IN THE CENTRAL SYSTEM MARKET BY VALUE - 1995

TABLE 24: UK MARKET FOR NON DOMESTIC SPACE HEATING 1988 - 2000 £M

CHART 25: UK NON-DOMESTIC SPACE HEATING CONSTANT 1990 PRICES £M MSP

TABLE 26: UK MARKET FOR COMMERCIAL BOILERS 1988 -2000

TABLE 27: THE UK COMMERCIAL RADIATOR MARKET 1988 - 2000

TABLE 28: THE UK HEAT EMITTER MARKET 1988 - 2000

CHART 29: MIX OF HEAT EMITTERS SALES BY VALUE 1995

TABLE 30: THE UK WARM AIR HEATER MARKET 1988 - 2000 (£M MSP)

CHART 31: MIX OF WARM AIR HEATERS 1995 BY VALUE

TABLE 32: THE UK RADIANT HEATER MARKET 1988 - 2000 (£M MSP)

TABLE 33: MIX OF RADIANT HEATING 1995 BY VALUE

TABLE 34: MARKET SHARES IN UK NON-DOMESTIC BOILER MANUFACTURING MARKET - 1995

TABLE 35: UK MARKET SHARES FOR EMITTERS BY VALUE 1995

TABLE 36: MARKET SHARES OF THE MAJOR DIRECT WARM AIR HEAT APPLIANCE MANUFACTURERS 1995

TABLE 37: MARKET STRUCTURE FOR THE RADIANT HEATING MANUFACTURERS 1995

CHART 38: CHANNEL SHARE FOR DIRECT & INDIRECT HEATERS BY VALUE 1995

TABLE 39: APPLICATION TYPE, DIRECT AND INDIRECT HEATERS BY VALUE 1995

TABLE 40: THE UK MARKET FOR HEATING AND VENTILATING ACCESSORIES 1988 - 2000 - £M MSP

TABLE 41: MIX OF VENTILATING AND CONDITIONING ACCESSORIES BY VALUE 1995

TABLE 42: MIX OF HEATING ACCESSORIES BY VALUE 1995

TABLE 43: CONTRACTORS OUTPUT - NEW WORK AND RMI NON HOUSING - CURRENT PRICES (£M)

TABLE 44: CONTRACTORS OUTPUT - NEW WORK COMMERCIAL SECTOR CURRENT PRICES (£M)

TABLE 45: NEW ORDERS OBTAINED BY CONTRACTORS 1990-1995 - CURRENT PRICES (£M)

TABLE 46: HOUSING COMPLETIONS 1988-1995 GREAT BRITAIN ('000)

TABLE 47: VALUE OF NEW UK HOUSING OUTPUT AND RMI OUTPUT (£M)

TABLE 48: NUMBER OF PROPERTY TRANSACTIONS IN ENGLAND AND WALES 1988-1995

CHART 49: PERSONAL DISPOSABLE INCOME & SAVINGS RATIO 1990-1995

TABLE 50: AGE DISTRIBUTION OF RESIDENT POPULATION - JUNE 1994

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EXECUTIVE SUMMARY

The overall ventilation, air conditioning and non domestic heating market has shown good growth over the last few years to a value of £1bn in 1995 at manufacturers selling prices.

The market grew sharply in the mid to late 1980s but subsequently declined between 1990 and 1993 due to the dramatic downturn in levels of construction during the recession. Whilst the overall market has exhibited some recovery in 1994 and 1995, this has been more marked in the air conditioning and ventilation sectors than in non domestic heating.

All the sectors have benefited from the improvement in industrial and commercial construction since 1993, although the ventilation sector in particular continues to be constrained by the depressed state of the housing market. It is anticipated that the overall market will exhibit better levels of growth in future driven primarily by improving levels of construction in all sectors, as well as being influenced by increasingly stringent building regulations and a number of industry trends.

Ventilation products account for 16 percent of the overall market, with a value of £159m in 1995. Sales into the industrial and commercial sectors have shown good growth in 1994 and 1995 due to a greater number of construction projects, as well, as more stringent regulations relating to air quality particularly in industrial enviroments where there are smoke and fumes.

The domestic sector provides considerable potential for ventilation products due to legislation requiring extractor fans to be fitted in kitchens and bathrooms, as well as a greater requirement for ventilation due to improving levels of insulation.

The key suppliers of ventilation products include Woods of Colchester, Vent Axia, Xpelair, NuAire and the Air Movement Group (who own Roof Units), with Woods, NuAire and the Air Movement Group having strength in the commercial and industrial sectors.

The Air Conditioning sector accounts for 34 percent of the overall market, with a value of £338m in 1995, and has exhibited significant levels of growth over the last few years.

There has been a general increase in demand for air conditioning as its benefits have become more widely accepted and this, combined with the currently low penetration levels is resulting in substantial market growth. In particular, there has been dramatic growth in packaged air conditioning systems, which currently account for some 49 percent of the overall market and are increasing in share at the expense of central station systems due to their ease of retrofitting and lower unit prices.

The PAC (Packaged Air Conditioning) Systems sector is now largely dominated by Japanese manufacturers including Daiken, Toshiba, Mitsubishi, Hitachi and Fujitsu, with other suppliers including IMI Air Conditioning, Carrier, Airedale, Denco, Edenaire and Weatherite. Key companies supplying Central Station Systems include Carrier, AAF, Trane, Waterloo Air Management and York International.

Distribution of air conditioning systems varies significantly between PAC Systems and Central Systems. Packaged units are sold mainly via distributors, although contractors also account for some sales. Central systems are primarily distributed direct to contractors reflecting the fact that they are usually installed in new build application areas, although end users are playing an increasingly important role.

Non Domestic Heating Sales account for around 17 percent of the overall market, with a value of £167m in 1995.

The sector consists of Commercial Boilers, Radiators, Heat Emitters and Direct Heating appliances with the mix of sales below. Overall this sector has shown some growth over the last few years having benefited from the upturn in levels of industrial and commercial construction. However, growth in sales of commercial boilers and radiators have been limited by a reduced number of office construction projects and dramatically reduced levels of public sector expenditure.

Heat Emitters and Warm Air Heaters have exhibited better growth due to their reliance in industrial application areas, although the outlook in the longer term is less optimistic reflecting the shift from manufacturing towards service industries in the UK. Sales of radiant heaters have been particularly buoyant due to the trend towards more energy efficient products.

Key suppliers of boilers include NEI International Combustion, Babcock Robey and Hamworthy, as well as Caradon Ideal, Potterton and Clyde Combustion, The major manufacturers of radiators are Caradon Stelrad, Myson and Barlo who have strength in steel panel radiators, with a number of competitors supplying more specialist products such as designer radiators.

Suppliers of heat emitters include Biddle Air Systems, Dunham Bush, SPC, Andrews, and HCP, with warm air suppliers including Powrmatic, Benson, Youngman, Reznor, Wanson and Andrews. Competitors in the radiant heating sector include Ambi-Rad, Hamworthy, Schwank, Gas Fired Products and Grayhill.

Heating and Ventilating Accessories achieved sales of some £344m, accounting for 34 percent of the overall market. Ventilation and air conditioning accessories account for 64 percent of this total, with heating accessories taking the balance.

Sales of ventilation and air conditioning accessories have performed well reflecting the growth in the air conditioning and ventilation markets, with key products being ducting, filters, grilles/diffusers/ registers, natural ventilators, fire/smoke/air control dampers, trickle ventilation and pressure attenuators/controllers. Filters have experienced good growth due to the factors including concerns over legionnaries disease and are expected to show further growth due to increasing air pollution, whilst the natural ventilation sector has shown an increase in popularity with a change in the buildings regulations permitting passive stack ventilation in domestic housing.

Heating Accessories were worth £124m, of which 73 percent was accounted for by building management systems, with the balance taken by programmers and thermostats. The sector has benefited significantly from the trend towards energy efficiency and this is likely to product good future growth particularly as the construction market improves in the medium to longer term.

This comprehensive report represents a detailed assessment of the market, reviewing major trends, key factors influencing developments and future prospects for the sector. Analysis is both quantitative and qualitative, based on our substantial experience of the building and home improvement markets.

Text © 1996 AMA Research

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