The sizzling summer may have made consumers bear the brunt of heat but air conditioner makers are laughing all the way to the bank with sales soaring by up to 30 per cent this season.
Major manufacturers like LG India, Samsung India, Haier, and Whirpool said demand from smaller cities and towns have been one of the major growth drivers.
“This has been a good year so far. On a year-to-date basis the industry has witnessed sales growth of around 20 per cent on an average. Although in some geographies, we have seen even 50 per cent growth for us,” LG India Business Head (AC) Saurabh Baisakhia told PTI.
Last year, overall industry AC sales till the month of May was around one million and this year it is estimated to be 1.2 million.
Expressing similar sentiments, Samsung India Senior Vice President, Consumer Electronics, Mahesh Krishnan said, “We have registered an over 30 per cent growth in our split AC sales in the year so far based on our new 2013 Split AC range introduction and the positive consumer buying sentiment.”
The off take for higher star rated ACs is especially good given the growing consumer consciousness on energy efficient products, he added.
Stating that it has been a very good summer season this year, Haier Appliances India President Eric Braganza said, “In the entire 2012 we sold 66,000 units of ACs but this year between January to May we have already sold 70,000 units.”
Whirlpool India Vice President, Corporate Affairs and Strategy, Shantanu Dasgupta said despite inflation and currency fluctuation impacting prices, this summer has been better than last year.
“Hence, while demand has been good, we were hoping to see more consumers shopping for air conditioners,” he said.
Baisakhia of LG also said the sales growth witnessed this year is despite the fact that the prices of the products are about 10 per cent more compared to last year.
He said there has also been more demand for energy efficient products and newer technologies like indoor air quality.
Interestingly, the smaller towns in India are contributing significantly to the sales apart from the metro cities.
“What is encouraging is that a major portion of growth is coming from the satellite towns. Moreover, people are also going for more energy efficient products and new technologies like indoor air quality,” Baisakhia added.
Elaborating further, Braganza of Haier said: “Consumers aspiration level is going high. In a normal household, 10 years ago AC was a luxury, now after TV and Fridge, AC is their next purchase. Purchasing power is increasing and income is also increasing in those areas.”
In smaller regions — Tier II and Tier III markets, AC sales peak from March to May. These are the markets of future, he added.
On the outlook for the year, Baisakhia said, “This year we are confident of maintaining the 20 per cent growth as up to 60 per cent of the business is closed in the first half itself. When the first half of the year is good, the second half also is usually good.”