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HVAC Component Manufacturers Fight To Remain in the Market

5 October 1999

Frost & Sullivan: North American Automotive HVAC Component Manufacturers Fight To Remain in the Market

    SAN ANTONIO, Oct. 5 -- The North American automotive heating,
ventilation and air-conditioning (HVAC) components aftermarket is currently
experiencing a turbulent period. While profits are decreasing, competition is
growing more intense with the introduction of new market participants.
Frost & Sullivan's (http://www.frost.com) study, North American HVAC Components
Aftermarket, analyzes five HVAC components used in the automotive industry:
condensers, compressors, evaporators, heater cores and accumulators and
receiver-driers. In addition, this research carefully examines competitive
factors and market trends impacting the industry.
    In 1998, revenues for the HVAC  components aftermarket reached
$553 million. The HVAC aftermarket is a mature market, and growth is primarily
driven by the increasing vehicle population. The steady U.S. economy, bullish
stock market, increasing employment opportunities and low inflation rates have
increased demand for luxury consumer items, such as automobiles equipped with
air-conditioning. As the number of vehicles with air-conditioning systems
increases, so does the demand for replacement parts.
    According to Frost & Sullivan research analyst Meenakshi Ganjoo, the
increase in demand for HVAC components has been met by increased competition
among HVAC component manufacturers.
    "Most aftermarket manufacturers offer products with similar features, so
consumers have very little brand awareness. This results in HVAC components
assuming a generic connotation and ensuing price pressure," says Ganjoo.
    The HVAC components aftermarket is also witnessing technological changes
driven by the auto manufacturers' continuous search to increase miles per
gallon ratings and efforts to meet government C.A.F.E. requirements.
Components such as condensers, compressors and evaporators are getting smaller
and lighter and air-conditioning components have been redesigned to work with
a newer refrigerant. Demand for more energy-efficient air-conditioning systems
is anticipated to affect future design and technological changes in the
aftermarket as well.
    Frost & Sullivan presents Marketing Engineering Leadership Awards to
companies that have worked hard to make a positive contribution to the HVAC
component aftermarket.
    The Competitive Strategy Award is given to Visteon Climate Control
Systems, Ltd and the Product Quality Award goes to Modine Manufacturing
Company.
    Frost & Sullivan is an international marketing consulting company that
monitors the HVAC components aftermarket for trends, measurements and growth
rates. This research is utilized to support industry participants with
customized consulting needs. Related reports include # 7060-18 North American
Light Truck Accessories Aftermarket and #5919-18 North American Automotive
Sensor Markets.
    Visit Frost & Sullivan's Web site at:  http://www.frost.com .

           Report:  5583-18    Date:  August 1999    Price:  $3,950